Hanwha Solutions projects over $778 mn operating profit in 2023

Hanwha Solutions Corp. projects its operating profit for this year would exceed 1 trillion won ($778 million) on an anticipated solar energy boom in the US, which helped it post its best-ever earnings last year, in synergy with its chemicals business.

The chemical and renewable energy unit of South Korea’s seventh-largest conglomerate Hanwha Group announced in a regulatory filing on Thursday that its consolidated operating profit for the whole of 2022 reached 966.2 billion won, up 30.9% from the previous year, on sales of $13.6 trillion won, up 27.3%.

Both figures were the company’s best-ever results thanks to the solid performance of its mainstay chemicals and renewable energy businesses, the company said.

“As the US solar power market is expected to grow rapidly following the implementation of the Inflation Reduction Act (IRA), we will maintain the growth momentum to achieve more than 1 trillion won in operating profit this year,” said Shin Yong-in, Hanwha Solutions’ chief financial officer.  

For the last quarter of 2022 ending in December, operating profit more than doubled on-year to 182.2 billion won, while sales rose 32.6% to 3.9 trillion won. But its bottom line swung to a loss partly due to one-off expenses at its chemicals and advanced materials units, including end-year bonus payments.

RENEWABLE ENERGY, CHEMICALS LEAD

Its renewable energy business returned to an operating profit of 350 billion won in 2022 from the prior year’s loss, with sales up 56% to 5.5 trillion won.  Both results were its historic highs since the company made a foray into the photovoltaic market in 2011.  

The company attributed the outstanding results to brisk sales of photovoltaic modules, or solar cell panels, in the US amid the global energy shortage crisis and in the rapid transition toward net zero carbon emissions. It also made big one-time gains after selling overseas solar and wind power assets.   

Its other core unit chemicals business reported 588.9 billion won in operating profit, off 43.7% from a year ago, partly due to narrowed spreads of its mainstay products polyvinyl chloride (PVC) and polyethylene. Sales added 10.2% on-year to 5.9 trillion won.

Advanced materials business saw a whopping 263.9% on-year gain in operating profit to 35.3 billion won on sales of 1.1 trillion won, up 22.7%, thanks to brisk sales of auto component materials in line with the expanded global car output.

Hanwha Solutions will enhance its mid- and long-term growth momentum with steady investment, it said.

It aims to complete the expansion of its solar cell panel manufacturing facility in Dalton, Georgia, in the US by the latter half of this year. It also plans to expand its local caustic soda (CA) production facility in Yeosu.

Write to Jae-Fu Kim at hu@hankyung.com

Sookyung Seo edited this article.