Hanwha Ocean has reopened the era of 1 trillion won (approximately $689 million) in annual operating profit for the first time in seven years since 2018.
Hanwha Ocean announced on Feb. 4 that it recorded sales of 12 trillion 688.4 billion won and operating profit of 1 trillion 109.1 billion won in 2025. Sales increased 18% and operating profit surged 366% compared to the previous year. The company suffered operating losses for three consecutive years from 2021 to 2023 during the Daewoo Shipbuilding & Marine Engineering era, but has been solidifying its profit trend through intensive structural improvements after joining the Hanwha Group in 2023.
The strong performance was led by the merchant vessel division. The revenue share of highly profitable liquefied natural gas (LNG) carriers increased due to production process stabilization, and the special vessel division contributed with smooth construction of Jangbogo-III and BATCH-II submarines. Selective order strategies and continuous cost reduction led to profitability improvements.
Order performance was also notable. Despite a decline in global orders, the company secured total orders of $10.05 billion (14 trillion 580.5 billion won), including 13 LNG carriers and 20 very large crude carriers (VLCCs), surpassing the previous year’s $8.98 billion.
The growth trend is expected to continue into 2026. The plan is to strengthen profitability through full-scale production in special vessel sectors such as submarines and frigates amid high ship price trends, along with overseas project orders.
To this end, Hanwha Ocean is accelerating its overseas defense market strategy by proposing early delivery of four vessels by 2035 for the Canadian Patrol Submarine Project (CPSP). In the merchant vessel sector, the policy is to expand orders centered on LNG ships to secure more than three years of work backlog by year-end, and focus on growth investment instead of dividends this year due to expanded U.S. investment.
Hanwha Ocean revealed at the 2025 earnings conference call regarding Canada’s “Canadian Patrol Submarine Project (CPSP)” that “we proposed delivery of four vessels by 2035 to meet rapid delivery, which is one of the most important factors Canada considers.”
The company presented a model to strengthen local production and maintenance capabilities by establishing a ‘one team’ system with British defense company Babcock. Hanwha Ocean explained, “We designed it to simultaneously secure operational sovereignty and independent maintenance capabilities through job creation in Canada, technology transfer, and establishment of a long-term maintenance ecosystem including in-service support (ISS).”
Particularly, the company emphasized that high-level communication and government-level support are being conducted in parallel as the government-to-government (G2G) nature of the project has recently been highlighted. This means defense exports are expanding beyond private contracts to diplomatic and security cooperation dimensions.
The outlook for the merchant vessel sector was also presented positively. Hanwha Ocean stated, “While we do not disclose specific order targets for this year, we will pursue orders centered on LNG ships, large container ships, VLCCs, and gas carriers to maintain approximately three or more years of current order backlog by year-end.”
U.S.-driven energy demand expansion is leading to improved ordering environment. The company diagnosed, “As the U.S. energy export expansion and LNG project resumption movements gain momentum, newbuilding demand in major vessel types is gradually increasing.”
Regarding exchange rate volatility expansion, the company maintains its existing currency hedging policy. Hanwha Ocean stated, “We do not adjust strategies based on specific exchange rate directions, but maintain current policies by comprehensively considering the company’s overall financial situation including U.S. investment,” adding “there will be no significant changes in currency hedging strategies due to government policy changes.” Previously, the government had instructed shipbuilders with high export ratios to strengthen foreign exchange risk management.
Shareholder return policy will be operated conservatively for the time being. The company revealed, “This year, open yard investment for productivity improvement and expanded U.S. investment including ‘MASGA’ are scheduled, so we plan not to implement dividends, prioritizing growth investment and financial stability.”
However, the company added, “Our financial structure is gradually improving as we achieved consecutive profits for the recent two business years and secured distributable profits,” and “In the mid-to-long term, we will review shareholder return policies including dividends within a range that does not compromise financial stability.”
Source: Business Korea
