[Click eStock] "HD Hyundai Mipo, Commercializing High-Value Shipbuilding... Trend of Profitability Improvement"

Kiwoom Securities forecasted on the 12th that HD Hyundai Mipo Dockyard's profitability will continue to improve in the mid to long term. They analyzed that the profit improvement speed will accelerate as high-priced ships, ordered at relatively high prices, are recognized as sales according to the construction (production) stage.

Perspective view of Hyundai Mipo Dockyard's liquefied carbon dioxide carrier ship

Han-gyeol Lee, an analyst at Kiwoom Securities, stated, "The proportion of sales from high-priced ships has expanded and productivity has improved, making the performance improvement trend in the third quarter of this year more prominent." He particularly noted, "The replacement of two low-profit Ro-Pax ships (cargo and passenger combined vessels) with two high-profit PC ships (car carriers) newly introduced into production led the performance improvement."

HD Hyundai Mipo Dockyard achieved sales of 1.0776 trillion KRW and an operating profit of 35.2 billion KRW in the third quarter of this year. Sales increased by 8.4% compared to the same period last year, and operating profit turned positive from a loss last year.

Lee explained, "The ships constructed in the third quarter of this year consist of 6% from orders placed in 2021, 62% from 2022 orders, and 32% from 2023 orders," adding, "Compared to major shipbuilders, the production period for the main ship types is shorter, so the product mix composition is rapidly improving."

He added, "The conversion of high-priced ships in the order backlog to sales is occurring quickly, and productivity is also improving as the skill level of foreign workers deployed on-site last year has increased," forecasting, "The trend of profitability improvement will continue."

He continued, "The subsidiary Hyundai Vietnam Shipyard plans to increase production facilities and raise the number of ships constructed by 1 to 2 vessels annually, aiming to increase construction volume by about 50% by 2030," emphasizing, "There is ongoing demand for the main selected MRPC ships (medium-range petroleum product carriers), so mid to long-term performance growth is expected."