Hanwha Aerospace posts 965.5% net growth

[HANWHA AEROSPACE]

Hanwha Aerospace posted a 965.5 percent growth in net profit to 475.2 billion won ($354.4 million) for the first quarter, largely driven by one-off non-operating earnings coming from its capital gain.

The market consensus for the company's net figure was unavailable.

Operating profit surged 385 percent on year to 228.5 billion won, far exceeding the analyst forecast of 99.2 billion won.

Sales surged 65.2 percent on year to 1.93 trillion won, higher than market expectations of 1.75 trillion won compiled by FnGuide.

The sudden surge in the operating profit was due to added contributions from a newly-merged munitions business unit as well as arms export to Poland.

The company's land systems business logged sales of 841.5 billion won, a 247 percent jump on year. Operating profit soared 5,107 percent to 177 billion won.

Sales and operating profit grew as earnings for the munitions business, separated from Hanwha Corporation, were added after the merger on April 1.

Supply deals signed with Poland for K9 self-propelled howitzers and a Chunmoo multiple rocket launch system also contributed to the profit.

Export sales came in at a record-breaking 474.9 billion won, making up 56 percent of the total sales and surpassing demand from the domestic market.

Sales in the aerospace business grew 31 percent to 390 billion won on year. Operating profit swung to the black, logging 15.9 billion won.

The company attributed its growth to an increase in long-term agreements and more orders for geared turbofan engines as the aviation industry recovered and travels and global logistics became active.

The security business saw a 26 percent on-year increase in sales to 273.6 billion won and operating profit jumped 13 percent to 37.5 billion won as sales for security cameras grew for the North American region.

The company plans to secure profit by pushing ahead with additional contracts to export weapons to Poland amid the global geopolitical crisis. It will also continue to invest in space launch vehicles and related business as new growth propellers.

The Kospi-listed aircraft engine manufacturer began revamping its defense business in July last year by acquiring Hanwha Defense, specializing in artillery, armed vehicles and air defense, as well as the defense division of Hanwha Corporation.

“The Korean defense industry with its 50-year history is growing into an export-centered business guided under governmental policies,” a Hanwha Aerospace said.

“Hanwha Aerospace will become a company that can contribute to national security and economy by pre-emptively obtaining the latest technologies for aerospace and land systems.”

BY LEE JAE-LIM [lee.jaelim@joongang.co.kr]