Hyundai Heavy Industries Group said its shipbuilding units swung back to profit in the third quarter because of increased sales of high-value liquefied natural gas carriers to shipping companies around the world and as more shipyard berths are set to be booked for the next couple of years for LNG projects in nations such as Qatar and Mozambique.
Hyundai said that third-quarter profit of Korea Shipbuilding & Offshore Engineering (KSOE), a holding company that oversees shipbuilding units in the group, came to 20.4 billion South Korean won ($17 million) on a consolidated basis compared with a net loss of 23.1 billion won ($19.8M) in the same three months a year ago.
KSOE currently manages the group's three shipbuilding companies, Hyundai Heavy Industries, Hyundai Mipo Dockyard and Hyundai Samho Heavy Industries.
Sales at KSOE amounted to 3.6 trillion won ($3.1 billion) in the third quarter, a rise of more than 12 percent compared with the same quarter of 2018.
“We're continuing with our solid performance in the broad shipbuilding sector, but due to global uncertainties sparked by the US-China trade dispute, global orders have fallen compared with last year,” said the earnings statement from KSOE.
“We're currently focusing on securing orders for LNG carriers and LNG-powered ships,” added the company.
LNG carriers are currently priced at around $190 million per ship and at least 70 are expected to be ordered in the next year or so for the Qatar LNG expansion at Ras Laffan in the Gulf and the Mozambique LNG buildout of multiple Trains in southeast Africa.
Hyundai Heavy Industries was split into two entities, KSOE and a reorganized Hyundai Heavy, under an agreement with the Korea Development Bank regarding the acquisition by Hyundai of rival shipbuilder Daewoo Shipbuilding & Marine Engineering (DSME).