Samsung Heavy’s Income Down by 82 Pct

South Korean shipbuilder Samsung Heavy Industries saw its earnings drop in the third quarter of 2017, mainly due to deliveries of low-priced vessels and a decrease in orders.

The shipbuilder’s net income for the three-month period ended September 30 plunged by 82 percent to KRW 23.4 billion (USD 21 million) from KRW 128.6 billion (USD 115.5 million) reported in the same period a year earlier.

The company ended the quarter with an operating profit of KRW 23.6 billion, against an operating profit of KRW 84.1 billion, representing a drop of 72 percent year-on-year.

During the quarter, SHI’s sales were down by 37 percent to KRW 1.75 trillion, compared to KRW 2.77 trillion reached in the same three months in 2016.

In mid-2017, Samsung Heavy Industries (SHI) unveiled its self-rescue plan, under which it would undertake workforce cuts through an early retirement scheme, and seek from its executives to return part of their salaries.

Although the exact number of workforce which would be reduced this year was not unveiled, the shipbuilder is expected to slash a total of 5,000 jobs by 2018, of which it already cut 1,500 during 2016.

On the back of a drop in new orders, SHI was forced to shut down some of its floating docks. The shipbuilder, which operates eight docks, including four floating docks, reportedly closed one of its three on-road docks in June and was planning to stop operations at another one in late July.

Samsung Heavy Industries earlier informed that it expects to end the year with some USD 6.2 billion worth of orders, slightly less than its 2017 goal of USD 6.5 billion.

World Maritime News Staff