South Korean shipbuilder Hanwha Ocean Co. saw its operating profit soar more than 70 percent in the first quarter of this year from a year ago, driven by a boom in orders for high value-added vessels such as liquefied natural gas (LNG) carriers.
Hanwha Ocean said in a regulatory filing on Monday that its operating profit in the January-March period reached 441.1 billion won ($299.25 million), up 70.6 percent from a year earlier.
Revenue rose 2.1 percent on year to 3.21 trillion won.
Its commercial shipbuilding division boosted both revenue and profitability on the back of high-priced projects and LNG carrier orders.
The special ship division also maintained a stable revenue stream based on submarine and surface vessel construction.
The energy plant division, however, saw a temporary decline in revenue due to the completion of some projects.
Hanwha Systems Co, a defense electronics company, in the meantime, reported increases in both revenue and operating profit, supported by defense exports and expanded domestic mass production.
The company posted 807.1 billion won in revenue for the first quarter, up 17 percent from a year earlier, and 34.3 billion won in operating profit, up 2 percent.
Its defense business was driven by strong exports to the Middle East and domestic mass production projects.
Revenue from the Cheongung-II multifunction radar (MFR) exported to the United Arab Emirates and Saudi Arabia was reflected in earnings, while active electronically scanned array (AESA) radar systems for the KF-21 fighter jet and avionics equipment also contributed to growth.
The information and communications technology (ICT) segment maintained stable revenue, mainly from affiliates.
However, the company swung to a net loss of 95.8 billion won. It cited expanded operating losses in its U.S. Philly Shipyard and temporary cost increases caused by heavy snowfall as key factors.
Meanwhile, HD Construction Equipment Co., launched earlier this year through the merger of HD Hyundai Construction Equipment Co. and HD Hyundai Infracore Co., reported improved performance driven by synergy from the integration.
HD Construction Equipment recorded 2.3 trillion won in revenue for the first quarter, up 22.1 percent on year, and 190.7 billion won in operating profit, up 88.3 percent.
Both revenue and profitability improved on the back of a recovery in demand for construction machinery and growth in the engine business.
In particular, expanding demand for infrastructure investment and resource development in emerging markets such as the Middle East and Latin America drove performance, while sales also increased in advanced markets including North America and Europe.
Source: Pulse