Three Shipbuilding Majors Hoist Full Sails... Combined Revenue Tops 53 Trillion Won for First Time

Combined operating profit reaches 5.8758 trillion won

HD Korea Shipbuilding & Offshore Engineering posts record results
Increase in deliveries of high value-added vessels

Hanwha Ocean triples operating profit year-on-year
Growth driven by higher share of LNG carrier revenue

Samsung Heavy Industries joins 10 trillion won revenue club after nine years
Expanded production volume for offshore projects

The three major domestic shipbuilders (HD Korea Shipbuilding & Offshore Engineering, Hanwha Ocean, and Samsung Heavy Industries) have posted their best results in a long time. Their combined revenue surpassed 50 trillion won for the first time ever, and operating profit approached 6 trillion won. This growth is analyzed as being driven by continued demand for high value-added vessels such as liquefied natural gas (LNG) carriers.

According to the shipbuilding industry on February 10, last year the combined revenue of the three shipbuilders came to 53.2716 trillion won, with operating profit at 5.8758 trillion won. Compared with 2024, these figures increased by 15.2% and 170.1%, respectively. Relative to 2024, when all three companies were simultaneously in the black for the first time in 13 years with a combined operating profit of 2.1747 trillion won, operating profit more than doubled.

The three shipbuilders preempted overseas markets with order strategies tailored to their respective business structures. HD Korea Shipbuilding & Offshore Engineering delivered record-high results and firmly took the lead among the three. The company increased deliveries of high value-added vessels such as LNG carriers with high margins. As productivity continued to improve, both revenue and operating profit at its shipbuilding affiliates remained strong. HD Hyundai Heavy Industries led the overall improvement by recording 2.0375 trillion won in operating profit. Each business segment also showed robust performance. In the shipbuilding segment, revenue rose 13.4% year-on-year to 25.0365 trillion won, while operating profit jumped 119.9% to 3.3149 trillion won. The engine and machinery segment also turned in solid results, achieving 4 trillion won in revenue as sales of marine engines increased and the share of eco-friendly, high value-added engines expanded.

Hanwha Ocean, whose operating profit tripled from the previous year, achieved 1 trillion won in operating profit for the first time in seven years. This is the highest annual level since 2010. Hanwha Ocean has surpassed 1 trillion won in operating profit only twice before, in 2010 and 2018. The company drove growth by increasing the share of LNG carrier revenue. In addition, as production schedules progressed for the three Jangbogo-III Batch-II submarines (the first, second, and third vessels), revenue increased and contributed to the overall revenue growth trend.

Samsung Heavy Industries, which joined the “10 trillion won revenue club” for the first time in nine years, improved its profit structure as its portfolio was reshaped around high-margin vessel types and production volumes for offshore projects expanded. At the Geoje Shipyard, production processes are currently underway for floating liquefied natural gas production, storage, and offloading facilities (FLNG) that extract natural gas at sea for projects in Malaysia, Canada, and Mozambique. A newbuild FLNG order contract with U.S. company Delfin is also imminent.

On the back of strong earnings, the three shipbuilders are also preparing to pay performance bonuses to in-house partner companies. Samsung Heavy Industries has decided to pay bonuses to partner company employees for the first time in 12 years. Partner company employees with at least five years of service will receive 208% of the base bonus, the same rate as Samsung Heavy Industries employees. Those with at least three years will receive 80%, and those with at least two years will receive 70%, with payments differentiated according to length of service. Hanwha Ocean has decided to apply the same bonus payment ratio to partner company employees as to its own executives and employees. In the past, partner company employees received bonuses at half the ratio applied to executives and employees, but this time they will be paid at the same ratio. HD Korea Shipbuilding & Offshore Engineering plans to continue its tradition of paying such bonuses every year.

The boom cycle in the shipbuilding industry is expected to continue. There are projections that favorable conditions could be sustained through large-scale project wins, such as “MASGA,” a Korea-U.S. shipbuilding cooperation industry initiative, and the Canadian submarine program, which could be worth up to 60 trillion won. HD Korea Shipbuilding & Offshore Engineering has set this year’s order target at 23.3 billion dollars (approximately 34 trillion won), 29.1% higher than the previous year. Samsung Heavy Industries has also presented a target of 13.9 billion dollars (approximately 20 trillion won), 76% higher than last year.

Eom Kyunga, an analyst at Shinyoung Securities, said, “This year, revenue growth at Samsung Heavy Industries and HD Hyundai Group is expected to stand out, as there will be a large recognition of high-priced merchant vessel volumes and increased revenue in the offshore business divisions,” adding, “Improvements in the performance of engine manufacturers that supply engines for vessels to be delivered will in the future translate into improved performance for the shipbuilders themselves.”

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