Hyundai Electric Reports Operating Profit of 4.3 Billion KRW in Q1... Returns to Profitability After 5 Quarters

[Asia Economy Reporter Ki-min Lee] Hyundai Electric, a power equipment and energy solutions affiliate of Hyundai Heavy Industries Group, has succeeded in returning to profitability after five quarters.

On the 27th, Hyundai Electric announced that it recorded consolidated sales of 386.4 billion KRW and an operating profit of 4.3 billion KRW for the first quarter.

Although sales decreased by 7.5% compared to 417.9 billion KRW in the same period last year, operating profit turned positive for the first time in five quarters since the fourth quarter of 2018.

Hyundai Electric stated that efforts to improve profitability through a selective order strategy focused on profitability, enhanced process efficiency, and tight management led to the improvement in profits. In particular, projects contracted through a profitability-focused order strategy in the ultra-high voltage equipment sector, including high-voltage circuit breakers and power transformers, in the second half of last year were reflected in this quarter's sales, Hyundai Electric explained. Additionally, the transformer smart factory in Ulsan, which began full-scale operation in January this year to improve production efficiency, contributed to the improved profitability of core products.

Hyundai Electric also explained that the intensive emergency management carried out over two years since 2018, which achieved workforce optimization and expense reduction, helped realize profitability.

Hyundai Electric plans to actively participate in projects in developing countries supported by official development assistance and bids related to Saudi Aramco, which require high technical skills, to secure profitability. Furthermore, it plans to expand its future growth engine in the power ICT solution business area to drive performance improvement.

A Hyundai Electric official said, “We are pursuing business soundness through a selective order strategy,” and added, “Based on long-standing know-how, we will continue to achieve profitability by developing ICT-based intelligent solution businesses.”