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Daewoo Shipbuilding expected to report net profit for 2nd straight year

All News 10:18 January 08, 2019

SEOUL, Jan. 8 (Yonhap) -- Daewoo Shipbuilding & Marine Engineering Co., one of the country's top three shipyards, is expected to report solid earnings for the second straight year, while two others -- Hyundai Heavy Industries Co. and Samsung Heavy Industries Co. -- are likely to continue to suffer losses, industry data showed on Tuesday.

According to data compiled by several brokerage houses, Daewoo Shipbuilding is forecast to log a net profit of some 260 billion won (US$232 million) last year on sales of 8.9 trillion won.

Its operating income is estimated at 800 billion won in 2018.

The company's better than expected bottom line might have been aided by increased orders for LNG carriers, and its cost-cutting efforts paid off, industry sources said.

Hyundai Heavy is expected to post a net loss of some 40 billion won on sales of 12.9 trillion won last year. Its operating loss is estimated at around 300 billion won. Hyundai Heavy's loss may come as the world's largest shipyard failed to reduce fixed costs.

Samsung Heavy is projected to have suffered a net loss of some 370 billion won last year on sales of 5.4 trillion won. Its operating loss is presumed at 410 billion won last year.

Hyundai Heavy said earlier that it and two other shipbuilding affiliates target securing combined deals worth $15.9 billion this year in the shipbuilding segment, marking a 20.7 percent rise from last year's goal of $13.2 billion. The three players won $13.7 billion worth of deals in 2018.

The two shipyards are expected to unveil their own order targets for the year later this month, but they are reportedly raising their own order targets by more than 10 percent for the year.

Daewoo Shipbuilding clinched deals valued at $6.81 billion last year, surpassing its annual order goal of $6.6 billion. Samsung Heavy bagged $6.3 billion worth of orders last year, lower than its initial target of $8.2 billion.

Daewoo Shipbuilding expected to report net profit for 2nd straight year - 1


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