DSME reports net loss of 1.74 trillion won for 2022

The Okpo Shipyard of Daewoo Shipbuilding & Marine Engineering (DSME) on Geoje Island, South Gyeongsang [YONHAP]

Daewoo Shipbuilding & Marine Engineering (DSME) reported a net loss of 1.74 trillion won ($1.34 billion) for 2022, failing to mark a turnaround due to higher outsourcing costs and collectively agreed wage.

Analysts forecast a net loss of 1.27 trillion won for last year for the shipbuilder, according to market tracker Company Wise. The loss widened by 2.6 percent compared to last year.

Operating losses, on the other hand, decreased 8 percent on-year to 1.61 trillion won. The operating losses were still larger than the market consensus of 1.26 trillion won.

Sales were up 8.3 percent from the prior year to 4.86 trillion won, slightly down from the forecast of 4.98 trillion won.

Its quarterly net loss was at 430.3 billion won for the fourth quarter of 2022, far outweighing the market consensus of 114 billion won and widening by 8 percent from the same period a year earlier.

Quarterly operating losses decreased 19.2 percent to 416.1 billion won, also surpassing the market forecast of 66.35 billion won.

Sales were up 6.9 percent to 1.45 trillion won, down from the expectation of 1.57 trillion won.

The Korean shipyard pointed to the rising outsourcing costs that caused losses worth about 250 billion won as well as the one-time settlement of a collective wage agreement for the deficit.

Yet it added it has procured stable supplies for 3 years and 5 months thanks to accomplishing the order target over the past two years, and is stably procuring additional work.

“Although it is still the environment is still unstable internally and externally due to Russia's invasion of Ukraine and the global economic recession, we will do our best to improve profitability,” a DSME official said.

BY SEO JI-EUN [seo.jieun1@joongang.co.kr]