Hanwha Solutions net down to 378 billion won in 2022 on sluggish demand

Industry

Published: 16 Feb. 2023, 19:08

Hanwha Solutions net down to 378 billion won in 2022 on sluggish demand

Hanwha Q Cells' Georgia solar cell plant [HANWHA SOLUTIONS]

Hanwha Solutions generated a lower-than-expected net profit of 378 billion won ($295 million) in 2022, down 38.7 percent on year.

It fell far short of the market consensus of 672.5 billion won compiled by FnGuide.

Yearly operating profit rose 30.9 percent to an all-time high of 966.2 billion won but just missed the market forecast of 1.1 trillion won.

Sales were up 27.3 percent to 13.7 trillion won, also a record high, beating the expectation of 13.4 trillion won.

Hanwha Solutions pointed to the "equity losses from affiliated companies" affected by the sluggish petrochemicals demand for the weaker-than-expected net profit.

But robust solar panel demand in the U.S. market drove operating profit and revenues to a record high, according to the company.

The solar business accounted for 36.2 percent of the operating profit with 350.1 billion won, a turnaround from the previous year’s operating loss of 328.5 billion won.

Last year, the renewables business marked a quarterly turnaround in operating profit in the April-June period, after being in the red for six consecutive quarters.

Meanwhile, its chemical business saw a 43.7 percent drop in operating profit to 588.9 billion won, due to lagging petrochemicals demand, accounting for 61 percent of the total.

“Uncertainties remain high this year due to factors including the slowing petrochemicals demand,” said Shin Yong-in, Hanwha Solutions chief finance officer.

“As the U.S. solar market is expected to expand this year following the enactment of the Inflation Reduction Act [IRA], we will continue the growth trend with a goal of 1 trillion won in operating profit,” said Shin.

On Jan. 11, Hanwha Solutions announced a $2.5 billion plan to expand its production facility in the United States. The company is expecting a total of $875 million in tax credits a year due to the IRA.

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