HD Hyundai Construction Equipment Reports Record High Operating Profit of 257.2 Billion KRW Last Year

51% Increase Compared to Previous Year
Annual Sales of 3.825 Trillion KRW

Targeting 4 Trillion KRW in Sales This Year
Cash Dividend of 700 KRW per Common Share

HD Hyundai's construction equipment affiliate, HD Hyundai Construction Equipment, achieved its highest-ever performance since its launch in 2017.

HD Hyundai Construction Equipment announced on the 6th that it recorded KRW 3.825 trillion in sales and KRW 257.2 billion in operating profit last year. Sales increased by 8.8% and operating profit rose by 50.8% compared to the previous year. With a significant increase in operating profit, the operating profit margin also rose by 1.9 percentage points to 6.7%.

Fourth-quarter sales were KRW 845.9 billion, and operating profit was KRW 26.8 billion. Compared to the same period last year, sales increased by 1.5% and operating profit by 11.2%. Although sales were sluggish in China and Europe, steady demand was seen in North America, India, and Brazil. Operating profit also increased despite expanded R&D expenses, due to effects such as price increases.

An official from HD Hyundai Construction Equipment explained, "There was an expansion of infrastructure investment in advanced markets and continuous resource development demand in emerging markets," adding, "The reduction of fixed costs due to increased sales and price hikes also contributed to the solid performance."

The financial condition also improved. At the end of last year, HD Hyundai Construction Equipment's debt ratio was 86%, down 21 percentage points from the previous year. The borrowing ratio also fell by 13 percentage points to 45%.

For this year, HD Hyundai Construction Equipment announced an annual management plan targeting KRW 4.012 trillion in sales and KRW 263.8 billion in operating profit. The company plans to focus on securing profitability through sales strategies centered on advanced and emerging markets, as well as expanding compact product lines and large equipment lineups.

Meanwhile, HD Hyundai Construction Equipment held a board meeting on the same day and resolved a cash dividend of KRW 700 per common share for last year. The total dividend amount is approximately KRW 12.7 billion.

In addition to cash dividends, the company will also engage in share repurchases and cancellations to enhance shareholder value. HD Hyundai Construction Equipment resolved to repurchase and cancel approximately 850,000 treasury shares resulting from the exercise of stock purchase rights related to the sale of industrial vehicle operations, along with an additional 590,000 treasury shares worth about KRW 30.3 billion. This corresponds to about 7.3% of the total issued shares. Through this, HD Hyundai Construction Equipment plans to increase both shareholder trust and corporate value by achieving a dividend payout ratio effect of about 40%, which is more than 10% higher than last year's payout ratio.

The company stated, "We will proactively respond to market risks and continue solid growth this year with business strategies that can expand market share. In particular, we will enhance profitability through strengthening product lineups in key regions and leading the market with eco-friendly products, while also doing our best to improve shareholder value for mutual growth."