Korea’s three largest shipbuilders are expected to report stronger second-quarter profitability as LNG carriers, very large gas carriers and FLNG projects ordered at higher prices make up a larger share of their work.
The combined operating margin of HD Hyundai Heavy Industries, Hanwha Ocean and Samsung Heavy Industries is forecast at 14.5% for the second quarter. Their combined revenue consensus is 13.0 trillion won, up 28.8% year on year, while operating profit is expected to rise 80.6% to 1.9 trillion won.
HD Hyundai Heavy Industries is projected to lead the group with a 15.7% operating margin. Its second-quarter revenue is estimated at 6.3 trillion won, with an operating profit of 992.0 billion won. Higher-priced LNG carriers and container ships ordered two to three years ago are now being reflected in earnings, alongside exchange-rate benefits and production efficiency gains.
Hanwha Ocean is expected to post a 14.3% operating margin, based on revenue of 3.5 trillion won and operating profit of 497.1 billion won. If achieved, it would be the company’s highest quarterly margin since the first quarter of 2020, when it operated as Daewoo Shipbuilding & Marine Engineering. Its merchant ship segment is driving the improvement, with Hyundai Motor Securities projecting an 18.6% margin for the division as higher-margin 2024–2025 orders and stronger VLCC profitability lift results.
Samsung Heavy Industries is forecast to record a 12.4% operating margin, its highest since 2013. Revenue is estimated at 3.2 trillion won and operating profit at 403.4 billion won. LNG carriers ordered at higher prices are being booked into revenue, while FLNG projects including Malaysia’s Z-FLNG, Canada’s Cedar and Mozambique’s Coral Norte are also contributing. iM Securities said the company has built a profitability base supported by the world’s largest single-yard LNG carrier backlog of 63 vessels.
Order intake is also supporting the outlook. Samsung Heavy Industries has secured $9.6 billion in orders this year, equal to 69% of its $13.9 billion annual target, raising the possibility that it could meet its annual goal for the first time in four years. Its merchant ship orders total 28 vessels worth $5.2 billion, including 14 LNG carriers, or 91% of that segment’s target. Offshore orders stand at two units, Coral Norte FLNG and the first Delfin FLNG, worth $4.4 billion, or 54% of the offshore target.
HD Hyundai Heavy Industries had an order backlog of $37.0 billion at the end of May, more than double its 2026 order target of $17.7 billion. It has filled 2028 delivery slots and has started taking 2029 volumes.
Hanwha Ocean has not disclosed an annual order target, but it has won 25 vessels worth $4.4 billion this year. The total includes 24 merchant ships, including 15 VLCCs and six LNG carriers, plus one wind turbine installation vessel.
The companies are also moving into broader areas beyond merchant shipping. Samsung Heavy Industries is pursuing offshore plant follow-up work, including the second Delfin FLNG and Canada’s Western FLNG. HD Hyundai Heavy Industries signed a 627.1 billion won contract in April with a U.S. energy development company to supply Himsen engines for data center power generation. Hanwha Ocean is expanding special-purpose ship work after completing its fourth special shipyard last year, which increased simultaneous submarine construction capacity from two to four. It is also pursuing overseas projects, including Canada’s submarine program.
Source: biz.chosun.com
