Korean Shipbuilders in Red
By Aiswarya Lakshmi
Monday, October 5, 2015
South Korean shipbuilders are struggling with huge losses stemming from the delivery of low-priced ships and a delay in the construction of offshore facilities such as drill ships.
The shipbuilders' earnings are expected to remain in the doldrums until the first half of 2016, although their third-quarter bottom lines may beat estimates after suffering a record loss three months earlier, reports Yonhap.
The country's big three shipbuilders - Hyundai Heavy, Daewoo Shipbuilding & Marine Engineering, and Samsung Heavy Industries - racked up a combined loss of 4.7 trillion won (US$4 billion) in the first half of 2015.
The three shipbuilders won orders worth just US$4.3 billion in the third quarter, while their target for this year amounted to US$47.1 billion.
Specifically, Samsung Heavy Industries reached US$9.8 billion until the end of the third quarter to show a progress of 65 percent.
Hyundai Heavy Industries’ cumulative amount was US$9 billion (47 percent), and that of Daewoo Shipbuilding & Marine Engineering was US$4.3 billion (33 percent).
Yonhap quoted Yoo Jae-hoon, an analyst at NH Investment & Securities as saying "Earnings may remain weak, especially due to weak demand for offshore facilities."