Major shipyards forecast to have returned to black in Q1

SEOUL-- South Korea's major shipyards such as Hyundai Heavy Industries Co. are widely expected to have swung back into the black in the first quarter of the year from a year earlier, largely thanks to cost-cutting measures, industry sources said Monday.

According to the sources, Samsung Heavy Industries Co., a major shipyard here, is expected to have racked up an operating income of 38 billion won (US$3.3 million) in the first quarter on sales of 2.1 trillion won. Last year, Samsung Heavy suffered a loss of 139 billion won.

Its estimated sales in the first quarter also compare with 2.39 trillion won the previous quarter.

Daewoo Shipbuilding and Marine Engineering Co, the most troubled major shipyard here, is also expected to have achieved positive operating income due to its massive cost-cutting measures.

Hit by a fall in new orders and a delay in the construction of offshore facilities, Daewoo Shipbuilding has been in the red since 2013.

Daewoo Shipbuilding suffered a net loss of 2.79 trillion won last year and an operating loss of 1.53 trillion won.

Earlier, Jung Sung-leep, president of Daewoo Shipbuilding, said he was confident of a turnaround in the first quarter.

Hyundai Heavy is predicted to have logged an operating income of 352 billion won in the January-March period, sharply lower than an operating income of 438 billion won for the previous quarter and 325 billion won a year earlier.

The shipyard has been in the black since the first quarter of 2016. Last year, Hyundai Heavy logged an operating income of over 1 trillion won.

But its sales are estimated to have dropped to below 10 trillion won in the first quarter from 10.35 trillion won three months earlier and 10.27 trillion won a year earlier, the sources said.

Source: Yonhap News Agency

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