Hanwha Solutions Turns Solar Power Business Profitable, Q2 Sales 3.3 Trillion KRW, Operating Profit 277.7 Billion KRW

Data provided by Hanwha Solutions

[Asia Economy Reporter Donghoon Jeong] Hanwha Solutions achieved profitability in its renewable energy sector, including Q CELLS' solar business, for the first time in seven quarters due to increased global energy market demand in the second quarter of this year.

Hanwha Solutions announced on the 28th that it recorded sales of KRW 3.3891 trillion and an operating profit of KRW 277.7 billion in the second quarter of this year (consolidated basis). Compared to the same period last year, sales increased by 22.0% and operating profit by 25.6%. This was driven by the turnaround to profitability in the renewable energy sector and solid performance in the chemical sector. Both sales and operating profit were the highest quarterly figures since the launch of the integrated corporation in 2020.

By business segment, the renewable energy sector recorded sales of KRW 1.2343 trillion, up 22.6% from the same period last year, and an operating profit of KRW 35.2 billion, turning profitable for the first time in seven quarters. This profitability turnaround was due to improved performance in the Q CELLS division (Hanwha Q CELLS), where premium branding strategically targeted the high-value residential market in the US and Europe, leading to a rise in solar module prices. Solar module prices have been steadily increasing amid the growing importance of climate crisis response, unstable fossil fuel supply driving up electricity prices, and countries expanding renewable energy from an 'energy security' perspective.

The chemical sector posted sales of KRW 1.6041 trillion, up 20.3% year-on-year, but operating profit decreased by 22.2% to KRW 228 billion. Sales increased due to higher selling prices of PVC (polyvinyl chloride) and PO (polyolefin) products amid rising oil prices, but operating profit declined as the spread (margin) narrowed due to increased prices of naphtha, a basic raw material. Looking at the two main businesses, renewable energy and chemicals, although petrochemical profits slightly decreased due to high oil prices, the competitiveness of the solar business, which replaces fossil fuels, was strengthened, resulting in overall stable performance.

The advanced materials sector recorded sales of KRW 299.6 billion and an operating profit of KRW 16.6 billion. This was due to increased sales of solar component materials driven by rising demand for solar modules and a recovery in demand for automotive component materials as major automakers increased production. The Galleria division posted sales of KRW 131.9 billion and an operating profit of KRW 3.6 billion.

Provided by Hanwha Solutions

Shin Yong-in, Vice President and Chief Financial Officer (CFO) of Hanwha Solutions, said, "The renewable energy sector is expected to see improved profitability in the third quarter as solar module sales increase and prices rise in key markets such as the US and Europe."

Hanwha Solutions is expanding investments in the US and Europe, where the energy transition is most actively pursued globally to address the climate crisis and energy security.

Earlier this year, the company acquired a stake in REC Silicon, a polysilicon manufacturer in the US, and is expanding a 1.4GW solar module factory in Georgia, USA. By securing raw materials stably and holding the largest single-module production capacity of 3.1GW in the US, Hanwha Solutions aims to strategically respond to the rapidly growing solar power demand in the US market.

In Europe, the company is strengthening its downstream business, including renewable energy development, construction, and operation. Earlier this month, Q Energy, a subsidiary established around RES France, which was acquired last year, started a new 500MW solar development project in Germany. Hanwha Solutions also acquired LYNQTECH, an energy trading platform company connecting power sellers and consumers, expanding its IT-based energy business and securing mid- to long-term growth engines.

Hanwha Solutions stated, "In response to the rapidly increasing global demand for renewable energy to address the climate crisis and energy security, we will secure stable profits from solar modules and actively pioneer the future energy market."