Hanwha Ocean Co. reported a dramatic turnaround in second-quarter results, swinging to an operating profit of 371.7 billion won ($267 million) from losses a year earlier, as the South Korean shipbuilder benefited from increased LNG carrier deliveries.
Revenue climbed 30% year-over-year to 3.29 trillion won ($2.37 billion) in the three months ended June, the company said in an earnings presentation Tuesday. The operating margin reached 11.3%, a substantial improvement from the prior year’s losses.
The gains reflected an expanded sales proportion of high-profit liquefied natural gas carriers while the sales recognition ratio of low-priced container ships decreased, according to the presentation. Commercial vessels generated 2.81 trillion won ($2.02 billion) in revenue with a 13.4% operating margin.
Yet the outlook remains clouded by industry headwinds. Climate Analytics warned that the LNG shipbuilding industry faces “an even worse oversupply situation” with 180 carriers totaling 32 million cubic meters of capacity scheduled for delivery in 2025 and 2026.
Chinese yards continue to dominate the global orderbook with 58% of vessels by tonnage, while South Korean builders like Hanwha focus on higher-value, technologically advanced ships to maintain competitiveness.
The company’s naval shipbuilding division posted 236.8 billion won ($170 million) in revenue with 18.3 billion won ($13 million) in operating profit, while offshore operations generated minimal profits despite 288.1 billion won ($207 million) in sales.
