HJ Heavy Industries Sees 347% Surge in Operating Profit, "Shipbuilding and Construction Both Improve"

Impact of Eco-Friendly Container and Special-Purpose Vessels
Stable Order Backlog Secured for Three Years

HJ Heavy Industries significantly increased its operating profit in the first quarter of this year, driven by improved performance in its shipbuilding division. The company’s results were bolstered by both revenue from eco-friendly, high-value-added vessels and improved cost ratios in its construction division.

7900TEU Eco-friendly Container Ship. HJ Heavy Industries

On May 15, HJ Heavy Industries announced in a public disclosure that, on a consolidated basis, it recorded sales of 541.4 billion won, operating profit of 24.6 billion won, and net profit of 25.5 billion won in the first quarter of this year. Compared to the same period last year, sales increased by 32%, while operating profit and net profit rose by 347% and 355%, respectively.

The improvement in performance was led by the shipbuilding division. As orders for high-value-added vessels, including eco-friendly container ships, were fully reflected in sales, shipbuilding division revenue increased by 70% from 158.1 billion won in the first quarter of last year to 268.6 billion won this year. During the same period, construction division sales rose from 247.9 billion won to 269.3 billion won, an increase of 8.6%.

The shipbuilding division’s profitability was attributed to a selective order-taking strategy focused on eco-friendly vessels and ship types with high cost competitiveness, increased orders for special-purpose vessels such as high-speed patrol boats, and advanced cost management. Meanwhile, the construction division maintained profitability by focusing on cost ratio management despite rising raw material prices and labor costs.

HJ Heavy Industries plans to continue its profit-oriented “qualitative growth” strategy this year as well. The company has secured a solid backlog of high-quality orders, including four next-generation Navy high-speed patrol boats and a multipurpose chemical response vessel for the Korea Coast Guard ordered at the end of last year, as well as a U.S. Navy maintenance, repair, and overhaul (MRO) contract, and four 10,100 TEU container ships ordered earlier this year.

A representative from HJ Heavy Industries stated, “As the share of revenue from high-profit projects centered on eco-friendly and high-value-added ships expands, operating profit has increased significantly. With more than three years of stable order backlog secured in both core business divisions, we will continue our stable growth trajectory through organizational improvements and cost structure innovation.”

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