HHIH swings to red on slump in affiliate, COVID-19

Hyundai Heavy Industries Holdings Co. (HHIH) said on Thursday that it swung to the red last year from a year earlier due to losses from equity ties with its oil refining unit and the new coronavirus pandemic.

Its net loss came to 789.7 billion won ($705.8 million) in 2020, compared with a net profit of 115.3 billion won a year ago, the company said in a regulatory filing.

Sales fell 29 percent on-year to 18.91 trillion won last year, while it suffered an operating loss of 597.1 billion won, swinging from an operating profit of 666.6 billion won.

"The operating loss stemmed from massive losses in the oil refining unit hit by a drop in oil prices, global business conditions pounded by COVID-19 and the South Korean won's strength against the US dollar," the company said in an emailed statement.

Hyundai Oilbank Co., a refining unit of HHIH, posted a 359.8 billion-won net loss in 2020, compared with a net profit of 312.9 billion won in 2019.

But HHIH said operating profits from other units like Hyundai Electric & Energy System Co. and Hyundai Global Service helped reduce the losses from its refining unit.

HHIH's subholding company Korea Shipbuilding & Offshore Engineering Co. swung to a net loss last year mainly due to the Korean won's strength against the US dollar.

Korea Shipbuilding's net loss stood at 835.2 billion won last year from a net profit of 213.1 billion won. Sales fell 1.8 percent to 14.9 trillion won and operating profit tumbled 74 percent to 74.4 billion won.

Korea Shipbuilding has three shipbuilders -- Hyundai Heavy Industries Co., Hyundai Samho Heavy Industries Co. and Hyundai Mipo Dockyard Co. -- under its wing.

HHIH's board of directors decided on a 5 to 1 stock split, and the stocks are slated to be traded on the main Seoul bourse from April 12.

HHIH will pay an interim dividend to its shareholders for the first time this year since it went public, the company said.

The global giant shipbuilding holding company has decided to pay 18,500 won per share in cash dividends to its shareholders this year, the same as a year ago. (Yonhap)