Red Balance Sheet
Daewoo Shipbuilding & Marine Engineering (DSME) is expected to mark a 1 trillion won (US$ 887.31 million) deficit in the third quarter again, after the second quarter.
According to shipbuilding and financial investment industry sources on Oct. 15, South Korea's “big three” shipbuilders – Hyundai Heavy Industries, the DSME, and Samsung Heavy Industries – are highly likely to show poor performance in the third quarter again, due to the aftershock of massive losses from offshore plant projects and the bad business situations from low oil prices.
The three companies will announce their Q3 business results at the end of this month or early next month. In particular, the DSME, which posted some 3 trillion won (US$2.66 billion) in losses in the second quarter, will get a lot of attention. Industry sources say that the company will show more than 1 trillion won (US$ 887.31 million) of losses in the third quarter as well. This is largely due to the cancelation of a 700 billion won (US$621.12 million) order for a drillship in the third quarter, and other losses caused by the results of KDB Bank's inspection, which will be completed at the end of this month.
An official from the DSME said, “Since the company canceled a contract for the construction of offshore plants and there are some conservative views due to the aggravation of conditions, these parts will be reflected in the results of the third quarter.”