Hyundai Heavy 2nd-quarter profit more than doubles on ship orders

Hyundai Heavy Industries Co., the world's largest shipbuilder, said Friday that its second-quarter net profit more than doubled, surging to a record on orders from Europe and the Middle East.

Hyundai Heavy earned 417.5 billion won (US$449 million; €329 million) in the three months ended June 30, the company said in a regulatory filing. Hyundai Heavy posted a profit of 192.4 billion won a year earlier.

Sales during the quarter at the Ulsan, South Korea-based company rose 30 percent to 3.88 trillion won (US$4.17 billion; €3.05 billion) from 2.98 trillion won a year earlier.

The company's earnings benefited from ship orders received in 2004 and 2005, said spokesman Kim Ki-young, including container ships, crude oil tankers and LPG carriers.

Ship construction can take about 6-7 months but the company consistently has a huge backlog of orders.

As of the end of June, Hyundai Heavy had orders for 315 ships valued at US$26.6 billion (€19.5 billion), Kim said.

Increasing international trade driven by China's economic growth contributed to the demand for Hyundai Heavy's ships, Kim said.

Shares in Hyundai Heavy have more than doubled this year on its solid performance. Investors, however, dumped the stock Friday, pushing it down 8.3 percent to 319,000 won (US$343; €251) in late session trading.

Hyundai Heavy, established in 1972, in just three decades rose to become the world's largest shipbuilder.

The company also designs and builds offshore facilities such as oil rigs and pipelines. It also manufactures marine terminals, power facilities, desalination plants, construction equipment and industrial robots.