Samsung Heavy doubles operating profit by offshore project sales surge

SOUTH Korea’s Samsung Heavy Industries reported sales of Won2.6trn ($1.8bn) and an operating profit of Won238.1bn ($165m) for the third quarter, representing increases of 13% and 99%, respectively, compared to the same period last year.

“The increase in operating profit was driven by an improved product mix, characterised by a decrease in revenue from low-priced containerships and an increase in sales from offshore projects,” the shipbuilder said in a statement.

According to Korea Investment & Securities, sales were in line with expectations, while operating profit exceeded consensus estimates by 8.9%.

The cumulative results for the third quarter amounted to sales of Won7.8trn and operating profit of Won566bn.

SHI forecasts that, in the fourth quarter, the proportion of sales from ships ordered during the ship price upcycle after 2023 will increase, alongside a rising share of sales from offshore projects.

“As a result, total sales for the year are expected to surpass the initial guidance of Won10.5trn set at the beginning of 2025.”

So far, SHI has received orders for 27 ships, worth a total of $5bn, or 51% of its $9.8bn target for the year.

The company has received orders for the following ship types: seven LNG carriers, nine shuttle tankers, two containerships, two ethane carriers, six crude oil tankers and one offshore production facility (preliminary work contract).

In merchant shipbuilding, $4.3bn, or 74%, of the $5.8bn annual order target has been achieved.

The company has secured orders totalling $700m in the offshore sector. It plans to finalise additional contracts for the Coral FLNG and Delfin FLNG projects within the year to meet its full-year order target of $4bn.

“Given the current progress of order negotiations, we expect to achieve the annual target,” SHI said.

Meanwhile, following moves by HD Hyundai Heavy Industries and Hanwha Ocean to enter the maintenance, repair and overhaul business for US naval ships, SHI signed an agreement in August with US MRO specialist Vigor Marine Group to commence full-scale operations, aligning with the “Make American Shipbuilding Great Again” initiative.