Kolon Global Q2 Operating Profit Up 71.5%... 'Earnings Surprise' Despite COVID-19

[Asia Economy Reporter Hwang Yoon-joo] Kolon Global recorded an 'earnings surprise' in the second quarter despite the impact of the novel coronavirus disease (COVID-19).

Kolon Global announced on the 10th that its consolidated operating profit for the second quarter of this year increased by 71.54% year-on-year to 47.7 billion KRW. Sales rose 5.75% to 931.3 billion KRW, and net profit surged 174.11% to 25.2 billion KRW.

Kolon Global explained, "Operating profit grew significantly by 71.5% year-on-year due to the reflection of settlement gains from completed construction projects, improvement in cost ratios, and increased sales of new BMW vehicles. Net profit also improved substantially as borrowings and financial costs decreased through continuous efforts to strengthen financial soundness."

The construction division of Kolon Global saw sales grow 5.2% compared to the same period last year. Although overseas construction sales temporarily declined due to the COVID-19 impact, the company sold about 9,800 apartment units last year, and with the commencement of large-scale projects, housing business sales grew by 26%.

Kolon Global secured new orders worth 1.8 trillion KRW this year. The order backlog stands at approximately 8.9 trillion KRW, which is five times the construction sales of last year, raising expectations for medium- to long-term performance, the company said.

A Kolon Global official stated, "Based on the stable performance of the distribution business division, growth in the housing business, and the expansion of the wind power generation business and private investment social overhead capital (SOC) projects that have been prepared for a long time, continuous growth is expected over the coming years."