HDC Hyundai Development shows weak performance Korean builder focuses on restoring credibility

Translated by Kim So-in 공개 2022-05-03 08:07:28

이 기사는 2022년 05월 03일 08:05 더벨 유료페이지에 표출된 기사입니다.

South Korean builder HDC Hyundai Development Company showed sluggish performance in the January-March period as it has focused on strengthening the safety inspection and supervision of all its construction sites after a fatal safety accident happened in the company’s construction sites in Gwangju.

HDC Hyundai Development said in its regulatory filing on April 29 that it recorded 7.03 trillion won ($5.56 billion) in revenue and 68 billion won in operating profit in the first quarter. Its revenue increased by 5.3% year-over-year while the operating profit decreased by 42.5%. Its net profit decreased by 48.1% to 47.5 billion won.

The earnings reflected the delay in the construction progress due to strengthening on-site supervision.

There was no additional loss related to a collapse of an apartment building at its construction site in Hwajung-dong, Gwangju in January. The company already reflected a loss incurred from a five-story building collapse on a bus in the same city in June 2021 in its financial statement for 2021. The accident is estimated to have caused 175.4 billion won loss, including provisions for construction losses of 24.4 billion and provisions of 53.3 billion. The total loss may change depending on the results of the detailed safety inspection and internal and external factors.

Even excluding allowance for bad debts incurred from the accident, HDC Hyundai Development saw its operating profit decrease due to poor sales of its new apartment units. Its housing business sold zero apartment units in the first quarter, which marks a sharp contrast to 1,879 units sold in the first quarter of last year.

HDC Hyundai Development is focusing on safety reinforcement by conducting multiple inspections to improve the safety of apartment buildings and restore its damaged credibility. (Reporting by Joon-hyuk Shin)
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