HD Korea Shipbuilding & Offshore Engineering, the mid-tier holding company of HD Hyundai’s shipbuilding division, recorded an operating profit of 1.356 trillion Korean won in the first quarter of this year, achieving its highest-ever quarterly performance. Earlier, Hanwha Ocean and Samsung Heavy Industries also announced strong earnings, pushing the combined first-quarter operating profit of the top three shipbuilders to exceed 2 trillion Korean won. Analysts note that the shipbuilding supercycle is translating into substantial earnings as the proportion of high-value eco-friendly vessels, such as liquefied natural gas (LNG) carriers, continues to expand.

On the 7th, HD Korea Shipbuilding & Offshore Engineering disclosed that its consolidated operating profit for the first quarter of this year reached 1.356 trillion Korean won, a 57.8% increase from the same period last year. Sales also rose 20.2% year-on-year to 8.1409 trillion Korean won. The operating profit margin, calculated by dividing operating profit by sales, hit a record high of 16.7% since the company’s inception in 2019. Despite reduced operational days due to the seasonal off-season, the expanded proportion of high-margin LNG carriers and eco-friendly vessels, along with improved productivity, drove the strong performance.

Notably, the integrated HD Hyundai Heavy Industries led the earnings growth. The merged entity, which combined with HD Hyundai Mipo in December last year, recorded an operating profit of 905.4 billion Korean won in the first quarter. HD Hyundai Samho also maintained a robust trend with an operating profit of 395.2 billion Korean won. The engine division saw improved profitability due to increased demand for dual-fuel engines and higher selling prices.

Hanwha Ocean, which previously announced its earnings, reported first-quarter sales of 3.2099 trillion Korean won and an operating profit of 441.1 billion Korean won. These figures represent year-on-year increases of 2% and 71%, respectively. The operating profit margin stood at 13.7%, marking the highest quarterly performance since the company’s rebranding as Hanwha Ocean in 2023. A source from Hanwha Ocean stated, “As revenue recognition from high-value commercial ship projects gains momentum, the trend of improving profitability is expected to continue.”

Samsung Heavy Industries also saw its first-quarter sales increase by 16% year-on-year to 2.9 trillion Korean won, with operating profit surging 121% to 273.1 billion Korean won. The operating profit margin was 9.4%.
Source: The ChosunDaily