Hyundai Construction Reports Q3 Operating Profit of 512.5 Billion KRW, Down 53.1% Year-on-Year

Increase in Cost Ratio Due to Rising Raw Material Prices
Sales Increase Driven by Large-Scale Projects

Hyundai Engineering & Construction announced on the 22nd that its operating profit for the third quarter of this year was 512.5 billion KRW, a 53.1% decrease compared to the same period last year. This was affected by the continuous rise in major raw material prices and an increase in cost ratio due to expanded expenses for site safety and quality. The consolidated cost ratio for the third quarter was 95.2%, up 1.3% from 93.9% in the same period last year. Net profit for the period was 394.6 billion KRW.

However, sales increased due to large-scale projects such as the Basra Refinery in Iraq and Panama Metro Line 3. Third-quarter sales amounted to 25.4234 trillion KRW, a 20.8% increase compared to the same period last year. Hyundai Engineering & Construction expects to achieve its annual sales target of 29.7 trillion KRW this year. The order backlog for the third quarter stood at 86.5905 trillion KRW, securing about three years’ worth of work. This was the result of securing new orders including the Busan Goejeong 5 District redevelopment project and the Daejang?Hongdae metropolitan railroad private investment project, as well as large domestic and overseas projects such as the Saudi Arabia Jafurah Project Package 2.

Hyundai Engineering & Construction explained, "While sales growth remains steady, we plan to improve profitability by executing a stable portfolio based on business development and financial competitiveness." In particular, it expects to continue the sales growth trend in the second half of the year, supported by smooth progress at large overseas plant sites such as the Basra Refinery in Iraq and the Olefin production plant in Poland, as well as increased sales from the expansion of domestic housing and data center businesses.

Hyundai Engineering & Construction stated that it is focusing on securing next-generation growth engines such as nuclear power, renewable energy, and future housing, while stabilizing profitability through business model expansion including new investment development projects.

It emphasized that it plans to expand its global nuclear power market share starting with the construction projects of the large-scale Kozloduy Nuclear Power Plant Units 7 and 8 in Bulgaria, for which design contracts are about to be signed, and the first small modular reactor (SMR) project in Palisades, USA.

Hyundai Engineering & Construction’s cash and cash equivalents (including short-term financial instruments) amount to 3.9688 trillion KRW, with a current ratio of 169.8% and a debt ratio of 132.2%. Its credit rating is AA-.

A Hyundai Engineering & Construction official said, "Amid prolonged domestic construction market downturn and global geopolitical risks, Hyundai Engineering & Construction is focusing on managing order soundness and profitability by strengthening business management expertise and close on-site support to establish a sustainable growth system." The official added, "Based on globally proven construction capabilities, we will strengthen non-competitive and high value-added businesses, expand the energy value chain, and devote ourselves to developing future core technologies and products to reinforce our position in the global construction market."

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