Hyundai Engineering & Construction (A000720) Q2 2024 earnings summary

Executive summary

• Revenue for 2Q24/H1 2024 reached KRW 17.2 trillion, up 30.1% year-over-year, achieving 57.8% of the annual target.

• Operating profit for the cumulative period was KRW 398.2 billion, a 0.3% increase year-over-year.

• Net profit for the cumulative period was KRW 354.5 billion, down 2.3% year-over-year, with stable profitability despite challenging market conditions.

• Major new orders/contracts included Saudi Jafurah Phase 2, SK EV Battery Plant, Daejang-Hongdae Railway, and large-scale infrastructure and energy projects in domestic and overseas markets.

• The company maintained a strong financial position, with a cash balance of KRW 3.04 trillion and robust capital management.

Financial highlights

• Cumulative revenue increased 30.1% year-over-year to KRW 17,166.5 billion.

• Gross profit margin declined to 5.1% from 5.9% year-over-year.

• Operating profit margin decreased to 2.3% from 3.0% year-over-year.

• Net profit margin fell to 2.1% from 2.8% year-over-year.

• Cash and cash equivalents at June 2024 stood at KRW 3.04 trillion, with total assets of KRW 24.93 trillion.

Outlook and guidance

• New orders for 2Q24 reached KRW 16.7 trillion, representing 57.5% of the yearly target.

• The company expects continued growth in overseas orders, especially in energy and infrastructure, with a focus on green energy and SMR projects.

• Investment in renewable energy and digital transformation will continue, with a mid-term goal of net zero by 2045.