Hanwha Solutions' quarterly performance beats market expectations

Hanwha's office building in Jung District, central Seoul [NEWS1]

Hanwha Solutions reported an expectation-beating quarterly performance Thursday, with its renewable energy business marking a turnaround for the first time in seven quarters.

Net profit came in at 244.5 billion won ($188.1 million), up 9.8 percent on year, far surpassing the market consensus of 113.2 billion won compiled by FnGuide.

Revenue stood at 3.4 trillion won, up 22 percent on year. Operating profit was 277.7 billion won, up 25.6 percent on year.

Both figures also exceeded the market expectation of 3.1 trillion won for quarterly revenue and 161.2 billion won for operating profit.

The significant jump in operating profit was driven by the strong quarterly performance of its renewable energy division, especially the solar energy business, according to the company.

Shin Yong-in, Hanwha Solutions chief finance officer, cited "sales increases driven by strong overall demand, amid higher electricity rates pushing up solar energy modules prices," for the improved profitability of its renewable energy business during an online conference call on Thursday.

The company operates in five separate business sectors: renewable energy, petrochemicals, advanced materials, retail and city development.

The renewable energy business logged an operating profit of 35.2 billion won, about 12 percent of the total, a turnaround from the operating loss of 64.6 billion won in the same period last year.

Meanwhile, the petrochemicals business made an operating profit of 228 billion won in the second quarter, about 82 percent of the total. The profit was a 22 percent decline on year due to rising raw material prices and an inflation-induced demand slump, according to Hanwha Solutions.

Hanwha Solutions expects demand in the renewable energy market will continue to remain strong into the third quarter, with the Ukraine-Russia war and higher electricity rates pushing up demand for solar energy panels.

Hanwha Solutions is focusing on expanding its renewable energy market shares in Europe and the United States.

Since last year, Hanwha Solutions has secured projects in Germany, France, Spain, Portugal and others with a combined capacity of 12 gigawatts, according to the company. Q Energy, the company’s wholly-owned European subsidiary, was established July 1.

Moreover, Hanwha Q Cells, the company’s solar energy division, is building a solar energy module production plant in Dalton, Georgia, which would bring the company’s total production capacity in the United States from the current 1.7 gigawatts a year to 3.1 gigawatts.

BY SHIN HA-NEE [shin.hanee@joongang.co.kr]