Daehan Jonggeon Reports 2.7 Billion KRW Operating Profit Last Year... "Smooth Acquisition of H&B Design"

[Asia Economy Reporter Jang Hyowon] Mid-sized construction company Daehan Jonggeon recorded a profit despite concerns over the real estate market and economic downturn.

Daehan Jonggeon announced on the 10th that it posted sales of 195 billion KRW and an operating profit of 2.7 billion KRW last year. Net profit for the same period was 3.7 billion KRW.

The company stated, "Many companies are unable to avoid losses due to the real estate market downturn caused by soaring raw material prices and unsold properties," adding, "Our company was able to achieve good results through a proactively established efficient management system and a long-accumulated client network."

According to the Korea Construction Industry Research Institute, the Construction Business Survey Index (CBSI) forecast for January this year stands at 56 points, still below the 50-point mark. When the CBSI falls below the baseline of 100, it means that more companies view the current construction market pessimistically than optimistically. The construction industry's sentiment is said to be at its lowest since the 2008 financial crisis.

In response, construction companies are expanding the proportion of high-profit new businesses and diversifying non-residential projects to find breakthroughs. Daehan Jonggeon also plans to continue its competitive edge in existing business divisions while increasing synergy areas with KOSDAQ-listed company H&B Design.

A Daehan Jonggeon official said, "With various government real estate policies such as the 1·3 measures accelerating the market rebound, future performance is expected to be stable," adding, "For risk hedging and sustainable growth, we are also reviewing high-growth new businesses with KOSDAQ company H&B Design."

He continued, "Although the schedule for H&B Design's acquisition of Daehan Jonggeon has been somewhat delayed, it is proceeding without any issues," emphasizing, "We will create synergy through sharing experience and know-how and realize external growth and profitability expansion."

Meanwhile, H&B Design previously announced that it would acquire 100% of Daehan Jonggeon's shares by investing a total of 20 billion KRW. So far, approximately 14.2 billion KRW has been paid, and the remaining balance of 5.8 billion KRW is scheduled to be paid in April.