South Korean shipbuilding group HD Hyundai recently announced that it achieved consolidated operating revenue of KRW 17.5549 trillion in the second quarter of 2024, up 12.4% year-on-year, and a consolidated operating profit of KRW 879.9 billion ( $640 million), up 86.2% year-on-year.
HD Hyundai attributes this performance to improved shipbuilding results, strong growth in the power equipment and marine aftermarket businesses, and the digital solutions business.
In the shipbuilding sector, HD Korea Shipbuilding & Offshore Engineering (HD KSOE), the intermediate holding company for HD Hyundai Group’s shipbuilding business, realized an operating income of KRW 6.6155 trillion during the reporting period, up 21.3% year-on-year. This is attributable to the fact that operating income from high value-added ships, such as eco-friendly dual-fuel ships, was fully reflected in the results. HD Hyundai realized an operating profit of 376.4 billion won (about $274 million), an increase of 428.7% year-on-year, and achieved a profit for the fifth consecutive quarter, thanks to the profitability improvement brought about by the order-screening strategy as well as the efforts to reduce costs by stabilizing production.
Specifically, HD Hyundai Heavy Industries, a subsidiary of HD KSOE, realized operating revenue of KRW 3.884 trillion, up 26.7% year-on-year, and operating profit of KRW 195.6 billion (approx. $142 million), an increase of 185.5% year-on-year; HD Hyundai Samho realized operating revenue of KRW 1.81016 trillion, an increase of 16.9% year-on-year, and operating profit of KRW 1.775 billion (approx. $1316 million), an increase of 182.2% year-on-year; HD Hyundai Mipo realized an operating revenue of KRW 1.1291 trillion, up 9.3 % year-on-year and an operating profit of KRW 17.4 billion (approx. $12.65 million), which is the company’s first profit after seven quarters.
In addition, HD Hyundai Marine Solution realized operating revenue of KRW 437.9 billion, up 20.2% year-on-year, and operating profit of KRW 71.0 billion (approx. $51.6 million), up 29.6% year-on-year, mainly due to strong growth in the marine aftermarket business and expansion of the digital solutions business in response to ever-tightening environmental regulations.
As of July 15, 2024, HD KSOE has taken orders for 144 new ships valued at approximately $16.27 billion, achieving 120.5% of its annual order target of $13.5 billion. Thus, HD KSOE has achieved its annual target ahead of schedule for the fourth consecutive year from 2021 to 2024, and is the first shipbuilding company among the three major Korean shipbuilding companies (HD Hyundai, Hanwha Ocean, and Samsung Heavy Industries) to achieve its annual order target ahead of schedule.
In terms of ship types, these include 8 liquefied natural gas (LNG) carriers, 60 product tankers, 40 liquefied petroleum gas (LPG)/ammonia carriers, 12 large container ships, 1 very large ethane carrier (VLEC), 2 liquefied carbon dioxide carriers, 6 very large crude carriers (VLCCs), 7 medium-sized crude carriers, 2 car carriers (PCTCs) , 1 Floating Storage and Regasification Unit (FSRU), 1 Offshore Unit, and 4 special ships.
