Dongbu Construction Posts KRW 1.6 Billion Operating Profit in Q2, Achieves Two Consecutive Quarters of Profit

Dongbu Construction has successfully achieved a profit for the second consecutive quarter. The company’s performance has gained momentum as the proportion of high-margin businesses increased and the completion of low-margin projects, which had high cost burdens, was finalized.

On August 14, Dongbu Construction announced that its consolidated sales for the second quarter reached KRW 413.1 billion, with an operating profit of KRW 1.6 billion.

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Although sales declined slightly compared to the same period last year (KRW 444.5 billion), operating profit turned positive from an operating loss of KRW 40.2 billion in the second quarter of last year. The operating margin also rose to 0.39%. Following an operating profit of KRW 15 billion in the first quarter, Dongbu Construction has maintained a profit for two consecutive quarters.

On a half-year basis, the company’s performance also improved significantly. In the first half of this year, sales and operating profit reached KRW 829.4 billion and KRW 16.6 billion, respectively. While sales decreased by 4.1% compared to the first half of last year (KRW 864.2 billion), operating profit swung from a loss of KRW 58.7 billion to a profit, improving profitability.

This improvement in performance is attributed to both the increased proportion of high-margin businesses and better cost ratios. The cost ratio, which exceeded 100% in the first half of last year, dropped to the 87% range in the first half of this year. In particular, the completion of projects with relatively high cost ratios led to an improved cost of sales structure, which had a positive impact.

The debt ratio also showed a stable trend. Thanks to the continued reduction of borrowings and capital expansion, the debt ratio for the first half of this year stood at 233%, down about 30 percentage points from the same period last year.

The company’s order intake in the first half was also notable. Dongbu Construction secured new contracts worth over KRW 1 trillion, including Section 1 of the Busan New Port-Gimhae Expressway, as well as redevelopment projects in Mangwoo-dong, Gocheok-dong, and Cheonho-dong. As of the first half, the order backlog stands at approximately KRW 10.9 trillion.

Dongbu Construction plans to maintain its strong performance by focusing on selective, profitability-driven orders, managing cost ratios by project, and reducing unnecessary expenses.

A Dongbu Construction official stated, "In the second half of the year, we will further expand high value-added businesses and strengthen our growth momentum through portfolio diversification and thorough risk management."

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