Daewoo E&C, "Will Achieve 32 Trillion KRW Sales Target in Next 3 Years"

[Asia Economy Reporter Yoo In-ho] Daewoo E&C announced on the 31st that its operating profit for 2019 was tentatively estimated at 364.1 billion KRW (consolidated basis), down 42.1% from the previous year. Along with last year's performance, Daewoo E&C announced that it plans to achieve sales of 32.1 trillion KRW over the next three years.

Daewoo E&C's sales last year were 8.6519 trillion KRW, down 18.4% from the previous year. Net profit was 201.2 billion KRW, a decrease of 32.3%. By business division, sales were ▲ Housing Construction Division 5.1208 trillion KRW ▲ Plant Division 1.5823 trillion KRW ▲ Civil Engineering Division 1.372 trillion KRW ▲ Consolidated subsidiaries, including the Vietnam Hanoi THT development project, recorded 576.8 billion KRW.

Operating profit in the fourth quarter was 44.8 billion KRW, down 52.1% from the same period last year. Fourth-quarter sales and net profit were 2.3093 trillion KRW and 21.7 billion KRW, respectively.

The fourth-quarter operating profit was 58.7% below the market forecast of 108.5 billion KRW.

Daewoo E&C explained the decline in last year's performance by stating, "Last year, sales temporarily decreased due to the 2016 accounting issues and delays in the 2018 pre-sale projects."

Although Daewoo E&C's performance declined last year, it emphasized that it achieved its order intake target. The company recorded an annual order intake of 10.6391 trillion KRW in 2019, a 9.9% increase compared to 9.6826 trillion KRW in the same period the previous year. Daewoo E&C currently holds an order backlog of 32.8827 trillion KRW, securing four years' worth of work compared to annual sales. This is an increase of more than 2 trillion KRW (8.1%) from 30.4135 trillion KRW at the end of last year.

A Daewoo E&C official said, "Despite the worsening external business environment, we recorded industry-leading order intake results both domestically and internationally, laying the foundation for a full-scale performance rebound starting this year. In particular, this year, we plan to pre-sell 34,764 housing units based on differentiated competitiveness in the real estate market." He added, "Overseas, the main contract for Nigeria LNG Train 7, where we secured the position as the first domestic construction company to be the prime contractor for an LNG liquefaction plant, is scheduled for the first quarter, and we expect to achieve growth through a full-scale performance turnaround."

On the same day, Daewoo E&C also disclosed its order intake and sales targets for the next three years. Daewoo E&C announced that it aims to achieve order intakes of 12.8 trillion KRW in 2020, 13.3 trillion KRW in 2021, and 14.4 trillion KRW in 2022. Sales are expected to reach 9.1 trillion KRW, 10.5 trillion KRW, and 12.5 trillion KRW, respectively, during the same period.

This content was produced with the assistance of AI translation services.