Hyundai E&C wins record $28.4 billion in new orders last year

South Korean builder Hyundai Engineering & Construction last year earned sales of 21 trillion won ($17 billion) thanks to growth in the domestic housing sector and overseas construction projects. Its volume of new orders also set a record high of 35 trillion won, equal to over 120% of its annual target.

The company on Thursday announced a tentative sales figure for last year of 21.2 trillion won on a consolidated basis, up 17.6% from 2021.

Hyundai E&C attributed its performance to continued construction activity in domestic housing and large-scale projects abroad like the launch of Saudi Arabia's offshore oil field project Marjan, the Basra oil refinery in Iraq and Panama's third metro line. In Korea, the company worked on the apartment complexes Gaepo Jugong Complex 1 in the Gangnam district of Seoul and Hillstate Songdo The Sky in Incheon.

New order volume also grew 17% from the previous year to a company record 35.4 trillion won, or 124.9% of its annual target of 28.3 trillion won. The major overseas projects won by Hyundai E&C included rail construction in the southern Philippines, a tunnel for the Neom city project in Saudi Arabia and Shuwaik Port in Kuwait. In Korea, it landed orders for the Shaheen ethylene plant in Ulsan, housing redevelopment in Gwangju's Gwangcheon-dong neighborhood and United Nations Command site in the Itaewon area of Seoul.

The order backlog stayed at 90 trillion won, up 14.3% from late 2021, so the company has secured enough work to last four years and two months.

Not everything went right for the company, however. Operating profit last year fell 22.8% to 582 billion won and net profit declined 12.5% to 485 billion won due to worsened short-term results by subsidiaries and rising prices of raw materials.

Hyundai E&C's cash and cash equivalents including short-term financial instruments late last year reached 4.7 trillion won and net cash 3 trillion won, attesting to stable cash flow. The solvency indicator liquidity ratio was 177.6% and debt ratio 111.9%.

"We will maintain this year management stability based on a sturdy financial structure and the highest credit rating," a Hyundai E&C source said.

Write to Eun-Ji Shim at summit@hankyung.com