Hanwha Solutions net rises 29.4% on year in first quarter

Hanwha Q Cells' solar plant in Georgia, United States. Hanwha Q Cells is Hanwha Solutions' solar business unit. [HANWHA SOLUTIONS]

Hanwha Solutions saw a 29.4 percent on-year increase in its net profit to 133.4 billion won ($99.7 million) in the first quarter, driven by strong demand for solar panels.

The figure beat the market consensus of 121.6 billion won compiled by FnGuide.

Quarterly operating profit came in at 271.4 billion won, a whopping 85 percent jump on year, beating the analyst forecast of 220.1 billion won.

The estimated solar energy tax credit of 22.9 billion won was included in its operating figure, as the U.S. Inflation Reduction Act (IRA) took effect on Jan. 1.

Sales rose 9 percent to 3.10 trillion won in the January-March period, missing the forecast of 3.15 trillion won.

Hanwha Solutions cited the robust solar demand in the United States for contributing to its upbeat performance.

The solar business accounted for 90 percent of the operating profit with 245 billion won, compared to its operating loss of 114.2 billion won during the same period last year.

Its solar business has seen steady growth in quarterly operating profit since its turnaround in the second quarter last year, boosted by the strong renewables demand in the United States.

Meanwhile, its chemical business saw an 87 percent drop in operating profit to 33.7 billion won, due to lagging petrochemicals demand.

The company expects the strong solar demand to continue into the second quarter.

“The renewable energy market condition turned favorable as the global demand for renewables increased, and therefore we believe that the solar module sales will stay strong into the second quarter,” Shin Yong-in, Hanwha Solutions' chief finance officer, said.

“For the chemicals business, we expect the performance to improve gradually starting in the latter half of the year with the rebound in the global economy and demand recovery in the domestic market,” Shin said.

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 [shin.hanee@joongang.co.kr]