POSCO’s logo is seen at the company’s headquarters in Seoul, South Korea July 20, 2016. REUTERS/Kim Hong-Ji

SEOUL, Jan 28 (Reuters) – South Korean steelmaker POSCO’s (005490.KS) operating profit more than tripled to a record 9.2 trillion won ($7.62 billion), boosted by a strong demand and rising prices for construction raw materials.

Global crude steel production rose 3.7% last year to 1.95 billion tonnes, according to data from the World Steel Association this month, despite an energy crisis that led to a drop in the production of the first Chinese producer.

POSCO’s consolidated operating margins in 2021 were 12.1%, compared to 4.2% in 2020.

The company’s fourth-quarter consolidated profit was 2.37 trillion won, in line with estimates of 2.3 trillion won, according to data from Refinitiv Eikon.

For 2022, POSCO expects consolidated sales of 77.2 trillion won, up from 76.3 trillion won in 2021. The company also expects capital expenditure of 8.9 trillion won this year.

Meanwhile, the company’s shareholders earlier on Friday approved a plan to spin off its steel business and form a holding company called POSCO Holdings Inc. read more

The new holding company will own 100% of the steel unit, which will remain unlisted, and will oversee the development of new businesses, such as battery materials and lithium.

POSCO stock closed 2.9% higher after the shareholders’ meeting, while the broader market (.KS11) rose 1.9%.

($1 = 1,206.8600 won)

Reporting by Joyce Lee and Heekyong Yang; Editing by Clarence Fernandez and Shounak Dasgupta

Our standards: The Thomson Reuters Trust Principles.