Hanwha Aerospace, LIG Nex1 post strong Q1 results thanks to arms exports

Hanwha Aerospace Co. headquarters in Changwon, South Gyeongsang Province [Courtesy of Hanwha Aerospace]

Hanwha Aerospace Co. and LIG Nex1 Co., South Korea’s two major defense companies, reported impressive performances in the first quarter on the back of strong arms exports, with Hanwha Aerospace seeing its defense exports exceed domestic sales for the first time.

Hanwha Aerospace said in a regulatory filing on Thursday that its first-quarter operating profit came to an all-time high of 228.5 billion won ($170.5 million), up by a whopping 385.1 percent from a year ago, on sales of 1.93 trillion won, up 65.2 percent.

Hanwha Aerospace’s defense exports exceeded its domestic sales for the first time in the first quarter.

The company posted 841.5 billion won in defense sales, up 247 percent from a year ago, and 177 billion won in operating profit, up 5,107 percent.

LIG Nex1 also posted strong results.

The company reported an operating profit of 68.2 billion won in the first quarter, up 35.1 percent from a year ago, on sales of 546.8 billion won, up 28 percent.

LIG Nex1 was able to achieve strong performance by focusing on command and control (C4I) system sales and exports to Indonesia.

Its first-quarter exports accounted for 19.5 percent of its entire business, up from 11 percent a year ago.

Other major Korean companies such as LG Chem Ltd. and POSCO Future M Co., in the meantime, posted mixed results.

LG Chem saw its operating profit drop by 22.8 percent on-year to 791 billion won for the first quarter. Its revenue, however, rose 24.9 percent to 14.48 trillion won.

The company’s petrochemical sector was affected by a global economic slowdown and oversupply, resulting in a 23.2 percent decline in revenue and an operating loss of 50.8 billion won.

POSCO Future M, on the other hand, recorded its best-ever quarterly revenue thanks to the growth in its battery materials business. The first-quarter revenue reached 1.14 trillion won, up 70.8 percent on-year. Its operating profit, however, fell 20.7 percent to 20.3 billion won during the cited period.