Hanwha Engine (082740) Q3 2024 earnings summary

Executive summary

• Q3 revenue was KRW 2,961억, up 57.8% YoY; operating profit expanded to KRW 153억 as sales increased and the cost ratio declined.

• Q3 net income turned positive at KRW 106억, versus a KRW 23억 loss a year earlier.

• Backlog reached KRW 32,428억 at Sep. 30, with ship engines accounting for 96%.

Financial highlights

• Q3 revenue was KRW 2,961억 versus KRW 1,876억 in Q3 2023; 9M revenue totaled KRW 8,759억.

• Operating profit was KRW 153억 versus KRW 11억 YoY; operating margin was 5.2%, up 4.6 percentage points YoY.

• Gross profit was KRW 266억; the cost ratio fell to 91.0% from 94.8% YoY.

• Pretax profit was KRW 137억 versus a KRW 31억 loss YoY; net income was KRW 106억 versus a KRW 23억 loss.

Segment performance

• Ship-engine sales rose to KRW 2,545억 from KRW 1,446억 YoY, supported by higher deliveries to domestic and Chinese customers.

• Non-ship-engine sales were KRW 416억; aftermarket sales were KRW 348억 versus KRW 334억 YoY, while SCR sales were KRW 68억 versus KRW 96억.

• Ship engines represented 96% of the KRW 32,428억 backlog; LNG vessels were 53%, containers 34%, and tankers 13% of ship-engine backlog.