HD Hyundai Q2 Operating Profit 472.6 Billion KRW...61.8% Decrease YoY

Petrochemical Operating Profit Drops 97.4%
Shipbuilding Division Turns Profitable

HD Hyundai announced on the 27th that it achieved consolidated sales of KRW 15.6213 trillion and an operating profit of KRW 472.6 billion in the second quarter of this year. Sales and operating profit decreased by 0.8% and 61.8%, respectively, compared to a year ago.

The significant decline was largely due to a drop of over KRW 1 trillion in operating profit in the refining sector compared to the previous year. Excluding refining, the shipbuilding, construction machinery, and power equipment sectors showed improved performance.

HD Hyundai Oilbank recorded sales of KRW 6.9725 trillion and an operating profit of KRW 36.1 billion in the second quarter. Compared to the previous year, sales decreased by 20.8% and operating profit by 97.4%. The operating profit in Q2 last year was KRW 1.3703 trillion. This year, due to the decline in international oil prices, there were inventory valuation losses related to products and raw materials.

Concerns over a global economic recession led major countries to maintain a tightening stance, and sluggish Chinese economic indicators slowed demand recovery, causing a decline in the complex refining margin and lowering profitability. HD Hyundai stated, "With the recent recovery in international oil prices and complex refining margins, we expect operating profit to gradually improve in the second half of the year."

The shipbuilding sector successfully turned a KRW 265.1 billion loss in Q2 last year into a profit. The shipbuilding intermediate holding company, HD Korea Shipbuilding & Offshore, recorded sales of KRW 5.4536 trillion, a 30.2% increase year-on-year, due to increased shipbuilding volume and ship engine deliveries. Operating profit was KRW 71.2 billion. From the third quarter, the effect of improved profitability due to price increases is expected to be reflected in the results, further expanding operating profit.

In the construction machinery sector, HD Hyundai Site Solutions recorded sales of KRW 2.4072 trillion, a 13.7% increase from the previous year. Demand increased as governments in advanced markets such as North America and Europe expanded infrastructure investments. Market share also expanded in emerging markets like India and Southeast Asia. Operating profit was KRW 270.9 billion, up 141.4%, supported by price increases and improvements in global logistics.

HD Hyundai Electric achieved sales of KRW 642.5 billion, a 19% increase year-on-year, due to strong global demand for power equipment. Operating profit rose 116.2% to KRW 58.8 billion. This was driven by a selective transformer order strategy and cost rate improvements in rotating machines and switchboards.

HD Hyundai Global Service recorded sales of KRW 364.4 billion and operating profit of KRW 54.8 billion, supported by continued expansion in high-margin ship parts services and eco-friendly ship retrofit business sales. HD Hyundai said, "With the recent orders for LNG carrier reliquefaction system retrofits and increasing demand for LNG-FSRU (Floating Storage Regasification Unit) retrofits, we expect positive results in the eco-friendly ship retrofit business going forward."

Solar energy affiliate HD Hyundai Energy Solutions recorded sales of KRW 151.1 billion and operating profit of KRW 7.9 billion, while HD Hyundai Robotics posted sales of KRW 49.3 billion and operating profit of KRW 2.9 billion, marking a return to profitability.

An HD Hyundai official said, "Based on accelerated profit improvement in the shipbuilding sector in the second half, improved refining market conditions, and solid performance in construction machinery and power equipment businesses, we expect to maintain a stable profit trend across all business divisions. We will continue to lead the market through ongoing development of eco-friendly and digital technologies and sustain stable results through profitability-focused sales strategies."

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