Hyundai Heavy Industries, a major South Korean shipbuilder, reported Tuesday that it swung to a net profit during the first quarter thanks in part to reduced costs and improvement in its non-shipbuilding business.
Net income came to 244.5 billion won ($213 million) in the January-March period on a consolidation basis, a turnaround from a loss of 125.2 billion won a year earlier, the company said in a regulatory filing.
Sales dropped 16 percent on-year to reach 10.27 trillion won, while it logged an operating profit of 325.2 billion won, a rebound from an operating loss of 192.4 billion won tallied in the same period the year before.
Eased burden from costs, favorable currency market situations and an improvement in its non-shipbuilding business were cited as factors that boosted its first-quarter earnings.
"A cost cut from lowered material prices, the fall in the local currency and a marked improvement in such non-shipbuilding areas as engine, electric, electronic and construction equipment helped induce the turnaround," a company official said.
Thoroughly reflecting the company's massive losses in 2015, instead of rolling them over onto following years, also appears to have played a role, the company noted.
Hit by an industry-wide slump and increased costs, Hyundai Heavy suffered 1.36 trillion won in losses last year following a drop of 2.21 trillion won a year earlier.
The nation's big three shipyards alone, including Daewoo Shipbuilding & Marine Engineering Co. and Samsung Heavy Industries Co., racked up a combined loss of 7.7 trillion won last year, due to increased costs from a delay in the construction of offshore facilities and order cancellations.
Hyundai Heavy shares spiked following the earnings results. They traded at 114,000 won as of 11:35 a.m. on the Seoul bourse, up 4.59 percent from the previous day. (Yonhap)
Net income came to 244.5 billion won ($213 million) in the January-March period on a consolidation basis, a turnaround from a loss of 125.2 billion won a year earlier, the company said in a regulatory filing.
Sales dropped 16 percent on-year to reach 10.27 trillion won, while it logged an operating profit of 325.2 billion won, a rebound from an operating loss of 192.4 billion won tallied in the same period the year before.
Eased burden from costs, favorable currency market situations and an improvement in its non-shipbuilding business were cited as factors that boosted its first-quarter earnings.
"A cost cut from lowered material prices, the fall in the local currency and a marked improvement in such non-shipbuilding areas as engine, electric, electronic and construction equipment helped induce the turnaround," a company official said.
Thoroughly reflecting the company's massive losses in 2015, instead of rolling them over onto following years, also appears to have played a role, the company noted.
Hit by an industry-wide slump and increased costs, Hyundai Heavy suffered 1.36 trillion won in losses last year following a drop of 2.21 trillion won a year earlier.
The nation's big three shipyards alone, including Daewoo Shipbuilding & Marine Engineering Co. and Samsung Heavy Industries Co., racked up a combined loss of 7.7 trillion won last year, due to increased costs from a delay in the construction of offshore facilities and order cancellations.
Hyundai Heavy shares spiked following the earnings results. They traded at 114,000 won as of 11:35 a.m. on the Seoul bourse, up 4.59 percent from the previous day. (Yonhap)
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