Sales reach 3.41 trillion won, up 13% on year
High-value vessels including LNG carriers drive results
Profitability held despite fewer working days, exchange rate headwinds
Company targets sales growth and margin improvement across all divisions in Q4
Hanwha Ocean posted growth in both sales and operating profit in the third quarter compared with the same period a year earlier, driven by a strong lineup of high-value vessels including LNG carriers and steady progress on its naval shipbuilding projects.
The company reported consolidated sales of 3.41 trillion won ($2.58 billion) and operating profit of 485.7 billion won for the third quarter, it announced Tuesday. Sales rose 13 percent on year while operating profit surged 68 percent. For the first three quarters combined, sales reached 12.07 trillion won and operating profit totaled 1.66 trillion won — up 28 percent and 81 percent, respectively, from the same period last year, widening the company's profit margin.
Third-quarter sales fell from the previous quarter, reflecting a base effect from offshore project revenue recognized in a lump sum at delivery in the second quarter, as well as fewer working days due to summer vacation and the Chuseok holiday and the impact of exchange rate movements. Compared with a year earlier, however, sales were up 13 percent, with high-value LNG carrier orders and steady progress on submarine and surface warship programs driving the growth.
Operating profit held firm on the strength of high-value vessel orders despite the reduction in working days and exchange rate effects. The company cautioned, however, that profitability in the fourth quarter could dip somewhat if one-time costs such as a lump-sum labor settlement and annual performance bonuses are booked. It added that the impact of exchange rate fluctuations on earnings is expected to gradually diminish, as the company has steadily expanded its currency hedging since June to reduce its foreign exchange exposure.
As of the end of September, Hanwha Ocean had secured orders for vessels and offshore wind installation ships totaling $7.72 billion. The order book by vessel type includes eight LNG carriers, six container ships, 18 very large crude carriers, three very large ammonia carriers, three very large gas carriers and one wind turbine installation vessel.
Hanwha Ocean said it plans to pursue sales growth and margin improvement across all business divisions in the fourth quarter. The commercial shipbuilding division expects year-on-year sales growth despite a shift in vessel mix toward VLCCs and container ships, underpinned by a high-value order backlog. The company projected it would maintain solid profitability on the back of a growing share of high-margin projects secured since 2024 and cost-reduction gains.
The naval shipbuilding division plans to accelerate construction schedules for the second vessel of the Jangbogo-III Batch II submarine program and the fifth and sixth hulls of the Ulsan-class Batch III frigate program, with the aim of increasing year-on-year sales. The energy and plant division intends to normalize progress on delayed projects and move new projects into the production phase to gradually grow sales, while pursuing early delivery and negotiations with clients to secure additional revenue and continuously improve profitability.
keg@heraldcorp.com
