Hanwha Ocean Co (A042660) Q1 2025 earnings summary

Executive summary

• Revenue for Q1 2025 reached KRW 3,143.1 billion, up 38% year-over-year, but down 3% sequentially due to fewer working days and project completions.

• Operating profit rose to KRW 259 billion, a 53% increase quarter-over-quarter and 389% year-over-year, driven by improved product mix and cost reductions.

• Net profit was KRW 216 billion, up 323% year-over-year, though down 63% from the previous quarter.

• The business covers LNG carriers, oil tankers, container ships, offshore platforms, special vessels, plant construction, and wind power.

• Recent expansion includes plant and wind power acquisitions and U.S. market entry.

Financial highlights

• Commercial vessel sales grew 32% year-over-year to KRW 2,569 billion, with operating profit surging 1,182% to KRW 233 billion.

• Naval ship sales increased 113% year-over-year to KRW 303 billion, with operating profit up 625% to KRW 41 billion.

• Offshore business sales declined 16% year-over-year to KRW 232 billion, with operating profit dropping 88% to KRW 2 billion.

• Gross margin for Q1 2025 was 13.4% (KRW 422.3 billion gross profit).

• Basic EPS for Q1 2025: KRW 685; diluted EPS: KRW 591.

Outlook and guidance

• Commercial vessel segment expected to maintain over 80% of total revenue, driven by LNG carrier sales and delivery of loss-making container ship projects.

• Naval ship segment anticipates annual revenue above KRW 1 trillion, supported by ongoing submarine construction and MRO projects for the U.S. Navy.

• Offshore segment expects stable revenue at 2024 levels, with profit maintained through close management and new project commencements.

• Order backlog remains robust at KRW 31,040.2 billion as of March 31, 2025.

• Continued focus on high-margin, eco-friendly, and technologically advanced vessels.