Despite a third-quarter net loss, some stock market analysts still think Doosan Heavy Industries & Construction, one of Korea’s leading power plant builders, will be able to achieve its annual order target of 10 trillion won ($9.4 billion) by the end of the year.
The company, the flagship of Doosan Group, posted a net loss of 15.8 billion won in the third quarter, a plunge from a net profit of 58.8 billion won in the same period a year ago.
Losses from equity ties with its money-losing affiliates, including Doosan E&C and Doosan Infracore, made the company swing into the red, it said in its third-quarter performance briefing Monday.
Another reason for its poor performance in the July-September period was because of decreased orders. Doosan Heavy won just 496.2 billion won worth of orders in the third quarter, a 70.9 percent drop from the same period last year.
“The company won 2.7 trillion won in orders in total for the first nine months, which is far below the firm’s annual order target of 10 trillion won,” Sung Ki-jong, an analyst of Daewoo Securities, said.
However, he remained positive about the fourth-quarter performance of the power plant builder, predicting that the company would be able to meet its annual target.
“Industry watchers have said the company will soon finalize a couple of deals worth 6 to 7 trillion won, including a 2.9 trillion won contact with the Vietnamese government to build four units of a coal-powered plant,” Sung said.
The company is also expected to sign a 2.2 trillion won contract for the construction of units 5 and 6 of the Shin-Kori nuclear power plant within the year, he added.
In October, the company won an 850 billion won contract with state-run Korea Midland Power to supply core equipment and facilities for Sinboryeong thermal power plant units 1 and 2.
“Overseas power plant projects are forecast to rise from the year’s end and so Doosan Heavy will be able to join more bids, particularly in the Middle East, from next year,” said Kim Hong-kyun, an analyst from Dongbu Securitiesd.
By Seo Jee-yeon (
jyseo@heraldcorp.com)
