[Click eStock] "Hyosung Heavy Industries, Continued Sales and Profit Growth Driven by European Orders"

Sangsangin Securities forecasted on the 29th that Hyosung Heavy Industries' profitability will continue to improve.

Hyosung Heavy Industries recorded sales of 984.5 billion KRW in the first quarter of this year, a 16.3% increase compared to the same period last year, and operating profit of 57.2 billion KRW, a remarkable 298.7% increase. This significant improvement in profitability is attributed to contract renewals in the construction sector and a turnaround to profitability in the heavy industry sector. However, the results were somewhat below market consensus. Kim Kwangsik, a researcher at Sangsangin Securities, diagnosed, "Profitability was weaker than expected as the proportion of high-profit North American sales decreased."

Regardless of market consensus, the trend of increasing sales and improving profitability is expected to continue throughout the year following the first quarter. Researcher Kim said, "New orders in the heavy industry sector grew by more than 17% as long-term delivery orders began, mainly from some European clients," adding, "With the increase in Internet Data Centers (IDC) and renewable energy sources, new and replacement demand in Europe is growing simultaneously, and overall new orders this year are expected to increase by 18.2%."

He added, "The North American subsidiary is also continuing its expansion, and with improved proficiency leading to higher operating rates, sales and profitability are improving," and forecasted, "Along with orders from Europe, the leverage effect of the North American subsidiary and stable profitability in the construction sector will drive continuous improvement in sales and profitability throughout the year."