Cautious Hyundai E&C takes a one-time charge

Hyundai Engineering & Construction’s second-quarter earnings plunged 35.3 percent on-year due mainly to a one-time charge for possible losses down the road.

Net income came to 118.4 billion won ($103.7 million) in the April-June period, compared with 182.9 billion won a year earlier, the company said in a regulatory filing. Sales gained 10.8 percent on-year to 3.2 trillion won in the three-month period, while its operating profit was down 11.2 percent at 166.8 billion won.

Despite the drop compared to the second quarter of 2011, sales and operating profit jumped 17.6 percent and 8.9 percent, respectively, from the first quarter. Net income was down 5.1 percent from three months earlier.

“We secured more than 10.2 trillion won in new orders in the first half, up 68.8 percent from the year before, but management has decided to be cautious and set aside money to cover losses that could occur,” a company spokesman said.