Hanwha Ocean continued its earnings growth in the third quarter of this year, driven by an increase in construction volumes for high-priced liquefied natural gas (LNG) carriers.
However, while revenue and operating profit decreased compared to the previous quarter, one-time costs such as settlement payments and performance bonuses are expected to impact profitability in the fourth quarter.
Hanwha Ocean said Tuesday that its consolidated revenue for the third quarter of this year was 3.4139 trillion won, and operating profit was 485.7 billion won. Revenue increased by 12.9% and operating profit by 67.6% compared to the same period last year.
Cumulative revenue for the first three quarters of this year was 12.067 trillion won, and operating profit was 1.6629 trillion won, representing increases of 27.6% and 80.7%, respectively, compared to the same period last year.
This is due to the expansion of construction volumes for vessels ordered at high prices in the past, centered on LNG carriers. Stable progress in special vessel projects, such as submarines and surface combatants, also contributed to revenue growth. Operating profit maintained solid profitability based on high-priced orders, despite a decrease in working days and exchange rate effects.
However, compared to the previous quarter, revenue decreased by 37.3% and operating profit by 34.0%, respectively. This was due to the base effect from the temporary recognition of revenue for marine projects in the second quarter at the time of delivery.
In addition, a reduction in working days due to summer vacations and the Chuseok holiday, combined with exchange rate effects, led to decreases in both scale and profit compared to the previous quarter.
In the fourth quarter of this year, whether one-time costs are reflected is expected to be a variable for profitability. Hanwha Ocean explained that profitability could decrease somewhat if settlement payments and annual performance bonuses are reflected. However, as it has continuously expanded hedging since June to reduce exposure to exchange rate risks, it anticipates that the impact of future exchange rate fluctuations on earnings will gradually diminish.
By business segment, the commercial vessel division is expected to continue revenue growth compared to the same period last year, based on its high-priced order backlog, despite changes in vessel composition such as an increased share of construction for very large crude carriers (VLCCs) and container ships. In particular, it plans to maintain profitability through an expanded revenue share from high-profitability projects ordered since 2024 and cost reduction results.
The special vessel division is also pushing for revenue expansion. By promoting the early completion of processes for the second ship of the Chang Bogo-III Batch-II class and the fifth and sixth ships of the Ulsan-class Batch-III, revenue is expected to increase compared to the same period last year.
The energy plant division expects revenue to gradually increase as it normalizes the progress of delayed projects and new projects enter the production stage. It plans to secure additional profits through early project delivery and negotiations with clients, while continuously improving profitability.
Hanwha Ocean recorded a total order value of $7.72 billion as of the end of September this year, including eight LNG carriers, six container ships, 18 VLCCs, three very large ammonia carriers (VLACs), three very large LPG carriers (VLGCs), and one wind turbine installation vessel (WTIV).
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