Struggling Shipbuilder
Samsung Heavy Industries announced on April 27 that its operating losses totaled 47.8 billion won in the first quarter of this year, up 14.5 billion won from a year ago and down 78 percent from the previous quarter.
The company’s Q1 sales added up to 1,826.6 billion won, up 25.3 percent from a year earlier. Its quarterly net loss increased from 102.6 billion won to 227 billion won during the period.
The company explained that the losses were because of ships it built for low-price contracts it concluded in the past. In addition, Samsung Heavy Industries China was temporarily shut down due to the spread of COVID-19 and fixed costs increased due to a reduced number of offshore plants to build.
Also, the company said that the sharp increase in quarterly net loss was because of financial costs and the weak won in the first quarter that led to forward exchange losses related to inventory assets.