Hanshin Gongyeong's Operating Profit Last Year 12.1 Billion Won... 69% Decrease Compared to Previous Year

Sales of 1.3067 trillion KRW, up 7% YoY
Net profit down 48% to 20.8 billion KRW
Debt ratio decreased 18% from previous quarter

Mid-sized construction company Hanshin Engineering & Construction recorded an operating profit of 12.1 billion KRW last year, a 69% decrease compared to the previous year (39.4 billion KRW).

According to the preliminary consolidated operating results announced by Hanshin Engineering & Construction on the 13th, last year's sales reached 1.3067 trillion KRW, a 7% increase from the previous year (1.0221 trillion KRW). Net profit for the period was 20.8 billion KRW, down 48% from the previous year (40 billion KRW).

Hanshin Engineering & Construction explained, "Sales increased as the sales rate of Pohang Hanshin The Hue Pentacity exceeded 90%, and construction progressed at two self-developed projects of Asan Hanshin The Hue. Net profit decreased due to an increase in cost ratio caused by the pre-reflection of rising costs such as labor expenses." They added, "Since an increase in contract amounts is planned for sites with pre-reflected costs, profitability is expected to improve this year."

On a consolidated basis, the debt ratio recorded 228%, down 18% compared to the third quarter of last year. On a separate basis, it fell 23% from the previous quarter to 158%. Hanshin Engineering & Construction stated, "We are preparing for a prolonged real estate market downturn based on over 300 billion KRW in cash assets and alternative funding capabilities backed by owned real estate, and the debt ratio is expected to gradually decrease."

The scale of contingent liabilities from real estate project financing (PF) was about 21% of equity capital, approximately 150 billion KRW. A Hanshin Engineering & Construction official said, "Unlike other construction companies focused on housing projects, we maintain a relatively low PF contingent liability scale by composing a sales portfolio with over 40% public sector sales and focusing on urban redevelopment project orders."