Hanwha Ocean (042660.KS) posted solid third-quarter results on the back of high-priced vessel construction, maintaining strong profitability despite fewer working days from summer holidays and the Chuseok break as well as a weaker won.
The shipbuilder reported third-quarter revenue of 3.4139 trillion won ($2.4 billion) and operating profit of 485.7 billion won ($340 million), it said on the 27th. Revenue rose 12.9% from a year earlier, while operating profit climbed 67.6%.
High-priced construction work centered on liquefied natural gas carriers drove the results, offsetting the impact of fewer working days and the weaker currency. The company said it will sustain growth on the back of that high-priced order book along with steady progress on submarine and surface combatant programs.
Revenue fell 37.3% from the previous quarter's 5.4432 trillion won, reflecting a base effect from offshore project revenue recognized at once upon delivery. Fewer working days and the weaker won also weighed on the figure. Hanwha Ocean said the impact of currency swings on earnings should diminish, as it has steadily expanded currency hedging since June.
For the first nine months, revenue rose 28% from a year earlier to 12.067 trillion won, while operating profit increased 81% to 1.6629 trillion won.
The company said profitability could weaken in the fourth quarter as one-off costs, including a lump-sum settlement payment and annual performance bonuses, are booked.
By division, the commercial shipbuilding unit expects revenue to rise from a year earlier on its high-priced order backlog, even as the mix of vessels under construction shifts toward very large crude carriers and container ships. Profitability is improving as high-margin projects won since 2024 account for a larger share of revenue and cost reductions take hold.
The naval and special ship division plans to lift revenue by accelerating work on the second Jangbogo-III Batch-II submarine and the fifth and sixth Ulsan-class Batch-III frigates. The energy plant division expects revenue to increase gradually as delayed projects return to normal schedules and new projects enter the production phase. It plans to secure additional earnings through early project deliveries and negotiations with clients.
As of the end of September, Hanwha Ocean held an order backlog of 39 vessels worth $7.72 billion (about 10.2274 trillion won). By type, VLCCs were the most numerous at 18, followed by eight LNG carriers, six container ships, three very large ammonia carriers, three very large gas carriers and one wind turbine installation vessel.