SEOUL, April 29 (Yonhap) — Global shipbuilding giant Hyundai Heavy Industries Holdings Co. (HHIH) on Thursday said that it returned to profit in the first quarter from a year ago on the back of strong performances led by its oil refining unit and construction equipment subsidiary.
Net income came to 294.4 billion won (US$266.1 million) in the January-March period, a turnaround from a net loss of 360.4 billion won a year ago.
Sales rose 6.3 percent to 6.07 trillion won in the period from a year earlier, with operating profit reaching 534.3 billion won, a turnaround from an operating loss of 487.2 billion won.
“Robust earnings in Hyundai Oilbank Co. and Hyundai Construction Equipment Co. led to the company’s strong first-quarter result,” HHIH said in an emailed statement.
HHIH’s refining subsidiary posted 193.6 billion won in net income in the first quarter, a shift from a net loss of 462.2 billion won a year ago.
The turnaround stemmed from increased oil prices caused by a recovery in demand for oil, improved cracking margin and a boom in the lubricant market, HHIH said.
Hyundai Construction Equipment Co., HHIH’s construction machinery manufacturing unit, said that its net profit rose nearly 60-fold to 59.4 billion won in the January-March period compared with a net profit of 1.2 billion won a year ago, helped by strong sales in China and India.
HHIH’s subholding company Korea Shipbuilding & Offshore Engineering Co. (KSOE) recorded weak first-quarter earnings compared with a year ago.
KSOE was forecast to have posted 38 billion won in net income in the January-March period, down 77 percent from a net income of 165 billion won a year ago, according to a consensus estimate of four analysts by Yonhap Infomax, the financial arm of Yonhap News Agency.
The downbeat estimate was based on sluggish orders clinched last year by its shipbuilding subsidiaries amid the COVID-19 pandemic. But the subholding company posted 63.6 billion won in net profit in the January-March period, down 61.4 percent from a year ago.
Sales fell 6.7 percent to 3.68 trillion won during the period, with operating profit dropping 44.5 percent to 67.5 billion won.
KSOE has three shipbuilders — Hyundai Heavy Industries Co., Hyundai Mipo Dockyard Co. and Hyundai Samho Heavy Industries Co., which stayed in the red in the first quarter.