Hanwha Aerospace Reports 2Q Operating Profit of 70.2 Billion KRW, Down 10.9% YoY
Operating Profit Increased by 2093% Compared to Q1 of the Year COVID-19 Began
[Asia Economy Reporter Ki-min Lee] Hanwha Aerospace announced on the 11th that it recorded sales of 1.1927 trillion KRW and an operating profit of 70.2 billion KRW in the second quarter of this year.
Second-quarter sales and operating profit decreased by 14.7% and 10.9%, respectively, compared to the same quarter last year before the outbreak of COVID-19, but increased by 16.1% and 2093.8%, respectively, compared to the first quarter when the spread of COVID-19 began. Net profit was 42.3 billion KRW, down 39% year-on-year.
By business segment, in the aviation sector, although sales slightly decreased compared to the previous year due to the decline in global aviation industry demand, Hanwha Aerospace explained that efforts to improve competitiveness in the engine division helped maintain the operating profit margin of the LTA (Long Term Agreement) segment at the previous year's level.
In the defense sector, Hanwha Defense led the overall consolidated performance increase in the second quarter with a significant rise in sales and operating profit due to increased exports of K-9 self-propelled howitzers to Norway. Hanwha Systems, a defense and ICT (Information and Communication Technology) affiliate, continued steady operating profit gains along with increased sales compared to the previous quarter.
In the civilian sector, Hanwha Techwin maintained a solid closed-circuit television (CCTV) business in the U.S. market despite the impact of COVID-19, resulting in a slight increase in profit margin compared to the previous quarter. Hanwha Power Systems saw significant increases in both sales and operating profit, supported by a growing proportion of high-margin AM (After Market) business.
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Meanwhile, Hanwha Precision Machinery experienced a slight decline in sales and operating profit due to decreased global demand caused by COVID-19 and other factors. A Hanwha Aerospace official stated, “We expect that uncertainties in the domestic and international economy and business risk factors, including the impact of COVID-19, will continue in the second half of the year. We will do our best to achieve business growth and improve profitability through continuous efforts to strengthen business competitiveness.”
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