Samsung C&T Posts Strong Q2 Despite COVID-19... Operating Profit Up 7.7% YoY

Q2 Sales Decrease 9.4% Year-on-Year to 7.223 Trillion Won

[Asia Economy Reporter Kim Ji-hee] Samsung C&T announced on the 21st that its operating profit for the second quarter of this year recorded 238 billion KRW, an increase of 7.7% compared to the same period last year. During the same period, sales amounted to 7.223 trillion KRW, a decrease of 9.4%.

A Samsung C&T official explained, "Sales decreased compared to the same period last year due to global demand contraction caused by the COVID-19 pandemic, weak raw material prices, and overall domestic consumption contraction. However, operating profit increased compared to last year due to overall profitability improvement efforts by business divisions and improved performance in the bio sector."

Operating profits by business division in the second quarter were ▲Construction division 148 billion KRW ▲Trading division 13 billion KRW ▲Fashion division 1 billion KRW ▲Food & Beverage division 36 billion KRW ▲Bio division 70 billion KRW. During this period, the Leisure division recorded a loss of 30 billion KRW.

Sales in the Construction division (2.842 trillion KRW) decreased by 9.8% compared to the same period last year, and operating profit also fell by 6.3%. Although sales slightly decreased compared to the same period last year due to the completion of large projects, it was explained that operating profit was maintained at a similar level to last year through continuous profitability improvement.

Construction orders increased by about 2.7 trillion KRW in the second quarter, including Gangnam area reconstruction, bringing the cumulative amount for the first half of the year to 5.3 trillion KRW. Samsung C&T plans to continuously pursue the annual target of achieving 11.1 trillion KRW.

The Trading division recorded sales of 3.017 trillion KRW and operating profit of 13 billion KRW in the second quarter of this year. Due to the impact of global demand contraction caused by the prolonged COVID-19 pandemic, trading volume decreased and raw material prices fell, resulting in sales and operating profit falling by 15.4% and 51.9%, respectively, compared to the same period last year.

The Fashion and Resort divisions were also not spared from the impact of COVID-19. Fashion division sales decreased by 9.4% compared to last year to 377 billion KRW, and operating profit dropped 90% during the same period to 1 billion KRW. In the Resort division, sales fell 10.6% compared to last year to 680 billion KRW, and operating profit sharply declined by 88.7% to 6 billion KRW.

A Samsung C&T official said, "A difficult management situation is still expected due to the impact of COVID-19, etc. We will continue efforts to optimize business structure and cost efficiency to minimize profit and loss impact, strengthen competitiveness by division, and execute strategies suitable for the new management environment to achieve annual management goals."

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