Poor Earnings Dent Doosan Group Stocks
The stock prices of Doosan Group’s listed affiliates plunged as they failed to meet market expectations last year.
The stock prices of Doosan Bobcat Co. and Doosan Corp. dropped by 7.53 percent and 7.52 percent, respectively, on the benchmark KOSPI market on Feb. 13. Doosan Infracore Co. also skidded by 5.73 percent and Doosan Heavy Industries & Construction Co. by 4.57 percent. Among Doosan units, only Doosan Engineering & Construction Co. (4.40 percent) and Oricom Co. (2.96 percent) posted a gain.
Poor performance last year seems to have adversely affected the stock prices of most Doosan subsidiaries. Doosan Corp., the group’s holding company, announced on the same day that its operating profit grew by 4.1 percent on-year to 1.22 trillion won (US$1.08 billion) last year. However, the figure fell short of the 1.38 trillion won (US$1.23 billion) expected by the market.
Doosan E&C also announced that it posted 1 trillion won (US$891.99 million) in operating profit last year, up 9.7 percent from a year earlier. Yet the figure was below the market forecast of 1.15 trillion won (US$1.02 billion).
Doosan Infracore announced in December that its consolidated sales in the fourth quarter of last year increased by 8 percent on-year to 1.78 trillion won (US$1.59 billion), but its operating profit decreased by 8 percent to 142 billion won (US$126.45 million). The poor performance is attributed to a fall in sales in China.
On the other hand, the operating profit of Doosan Bobcat, which released its results on Feb. 13, stood at 103 billion won (US$91.72 million), up 24.5 percent from the fourth quarter of last year. However, it still fell short of market expectations.
Analysts say Doosan units will have to improve their performance and expand dividends this year to boost their share prices.