Samsung Heavy Industries Co, the world's second-largest shipbuilder, said that profit in the third quarter rose 23 per cent to a record as it built more vessels at higher prices.
High ground: Shipyards in South Korea are working to complete record orders won at higher prices
Net income climbed to 174.2 billion won (S$191.6 million) in the three months to Sept 30 from 141.5 billion won a year earlier, the Seoul-based company said in a regulatory filing yesterday. Sales increased 16 per cent to a record 2.6 trillion won.
Shipyards in South Korea, the world's biggest shipbuilding nation, are working to complete record orders won at higher prices with deliveries stretching into 2012. Future earnings will be boosted by softening material costs as the global financial crisis weakens demand for steel.
'The average price of vessels that are being built will increase as shipyards build more vessels bearing higher margins,' said Lee Jae Kyu, an analyst at Mirae Asset Securities Co in Seoul. 'Earnings will be better from the fourth quarter as material costs fall.' He rates Samsung Heavy a 'buy'.
Operating profit, or sales minus the cost of goods sold and administrative expenses, climbed 20 per cent to 142.5 billion won in the third quarter.
Samsung Heavy gained 2 per cent to close at 20,900 won in Seoul trading before the earnings announcement. The stock has dropped 48 per cent this year.
High ground: Shipyards in South Korea are working to complete record orders won at higher prices
Net income climbed to 174.2 billion won (S$191.6 million) in the three months to Sept 30 from 141.5 billion won a year earlier, the Seoul-based company said in a regulatory filing yesterday. Sales increased 16 per cent to a record 2.6 trillion won.
Shipyards in South Korea, the world's biggest shipbuilding nation, are working to complete record orders won at higher prices with deliveries stretching into 2012. Future earnings will be boosted by softening material costs as the global financial crisis weakens demand for steel.
'The average price of vessels that are being built will increase as shipyards build more vessels bearing higher margins,' said Lee Jae Kyu, an analyst at Mirae Asset Securities Co in Seoul. 'Earnings will be better from the fourth quarter as material costs fall.' He rates Samsung Heavy a 'buy'.
Operating profit, or sales minus the cost of goods sold and administrative expenses, climbed 20 per cent to 142.5 billion won in the third quarter.
Samsung Heavy gained 2 per cent to close at 20,900 won in Seoul trading before the earnings announcement. The stock has dropped 48 per cent this year.