HD Hyundai Reports Q1 Sales of 11.3 Trillion Won... Boost from Refining and Shipbuilding Sectors

Operating Profit Up 50.7% Year-on-Year to 805 Billion Won
"Profitability-Focused Business Strategy"

Expanding Investment in Core Technologies of Four Future Fields: Future Ships, Healthcare, Fuel Cells, and Digital

[Asia Economy Reporter Oh Hyung-gil] HD Hyundai, the holding company of Hyundai Heavy Industries Group, announced on the 28th that its consolidated first-quarter sales reached 11.2966 trillion KRW, an increase of 85.9% compared to the same period last year. Operating profit recorded 805 billion KRW, up 50.7% from the same period last year.

Sales in the refining sector increased due to rising international oil prices, and sales significantly grew as Korea Shipbuilding & Offshore Engineering's performance, previously accounted for under the equity method, was consolidated from March. In February, HD Hyundai acquired a 4.1% stake in Korea Shipbuilding & Offshore Engineering from KCC and Asan Social Welfare Foundation, pushing its effective control beyond 50%.

Hyundai Oilbank recorded sales of 7.2426 trillion KRW and operating profit of 704.5 billion KRW, driven by inventory valuation gains from rising oil prices and improved refining margins due to increased demand for petroleum products.

Hyundai Genuine achieved sales of 2.1444 trillion KRW and operating profit of 133.8 billion KRW, influenced by increased construction equipment sales in advanced markets such as North America and Europe, as well as emerging markets.

Hyundai Electric saw sales decline to 351.8 billion KRW due to carryover volumes caused by port congestion, but recorded an operating profit of 16.7 billion KRW through selective orders focused on profitability. Hyundai Global Service posted sales of 300.1 billion KRW and operating profit of 24.3 billion KRW.

Korea Shipbuilding & Offshore Engineering's first-quarter sales decreased by 12% from the previous quarter to 3.9077 trillion KRW, and operating loss amounted to 396.4 billion KRW due to rising raw material prices and provisions for losses related to industrial facility construction.

A Hyundai Heavy Industries Group official stated, "We are maintaining solid performance in non-shipbuilding sectors, and the shipbuilding sector is also experiencing market improvements with rising ship prices and increased demand for eco-friendly vessels," adding, "We will do our best to continue stable performance through profitability-focused business strategies and the development of market-leading eco-friendly technologies."

Meanwhile, HD Hyundai announced plans to strengthen its role as an investment holding company, while Korea Shipbuilding & Offshore Engineering will enhance its role as an operating holding company. HD Hyundai plans to expand investments in four key future sectors: next-generation ships (Avikus), healthcare (Mediplus Solution), fuel cells, and digital technologies.

Korea Shipbuilding & Offshore Engineering announced goals to achieve 500 billion KRW in sales within five years on a standalone basis and 1 trillion KRW in mid-to-long-term sales through new business development such as next-generation energy source processing systems and fuel efficiency improvement systems.