Daewoo E&C on a Roll

Its operating profit registers 50.8 pct rise at the end of Q3 at 502.9 bln won

Daewoo Engineering and Construction Co. recorded the best quarterly performance in its history with its operating profit rising 109.1 percent to 208.2 billion won on sales of 1.433 trillion won. The company's ordinary profit amounted to 570.2 billion won in the first three quarters of this year on sales of 4.198 billion won. Net profit alone amounted to 393 billion won during the first three quarters, the best among Korean construction companies in the country. Sales revenue rose 16.4 percent from the same period last year, owing to such large and profitable projects as the Hwasung combined cycle thermal power plant, Yongsan City Park and Shindorim Technomart.
The operating profit at the end of Q3 amounted to 502.9 billion won, up 50.8 percent YoY, with operating profit rising 11.9 percent. Ordinary profit increased 44.1 percent YoY with its margin up 13.6 percent. Net profit rose 34.9 percent at 393 billion won at the end of Q3.
The company targets to clinch 8.5 trillion won in orders this year and sales of 5.544,6 trillion won, operating profit of 532.8 billion won and 582.6 billion won in ordinary profit. The company feels that it can easily achieve those targets for this year.
Since its establishment in 1973, Daewoo Engineering and Construction Co. has led Korea's construction industry with superb technologies and high quality products and services in its core business fields such as housing , architectural works, civil engineering projects, power and industrial plants, and overseas project business development. So far, the company's excellent construction capabilities have won a world-wide recognition as a result of various projects it has completed both at home and overseas.
At home, the company has been acknowledged for its achievements and know-how in a variety of construction projects such as the Incheon International Airport, the Korea High Speed Railroad, the 1st International Passenger Terminal of the Incheon Port and Wolsung Nuclear Power Plant No.3.
Internationally, Daewoo E&C has been proceeding with turnkey projects to build large-scale gas plants in Nigeria and the Benghazi Central Hospital in Libya, and it has completed the Trump World Tower in New York, and an office building for the Telecom Malaysia Group, which has emerged as a new landmark in Asia. In particular, the Telecom Malaysia project serviced as an excellent opportunity for the company to gain confidence in world markets of construction. Based on its technological prowess and the construction expertise that it has accumulated through those projects, the company has won other mega-plant projects such as the Sakhalin-II LNG plant in Russia and $668 million gas condensate refinery plant construction project in Iran. Such projects have enabled Daewoo E&D to cement its presence as a world-class construction company.
The company has been trying to diversify its project regions in the world away from the Middle East, where over more than 70 percent projects undertaken by Korean companies are located. Its effort has paid off in Nigeria, the largest oil exporting nation in Africa. The company won a project worth $875 million in Nigeria, Gbaran-Ubie Integrated Oil & Gas Project, the largest single one for the company since its participation in overseas construction market more than three decades ago.
The project makes up about 70 percent of total overseas project orders last year amounting to $1.25 billion and involves the construction of oil and gas production facilities with capacities to produce 120,000 barrels of refined oil a day and 1 billion cubic feet of natural gas. Under the project based on the EMC, the facilities ordered by the Shell Petroleum Development Co. of Nigeria Ltd., will be able to produce 5.4 percent of oil and 24 percent of natural gas consumed in Korea.
The Nigerian government plans to build many more power plants in the country to meet the rising power demand and the current power supply can only meet 40 percent of the entire demand, not enough to back up the development of national industrial projects. Daewoo has been put in an advantageous position to win more of those projects by landing already the Afam power plant project and when it is successfully completed.
In the meantime, Daewoo E&C has won an order to build a combined cycle power plant in Nigeria(AFM VI Combined Cycle Power Plant Project) from SPDC worth some 500 billion won. The project involves the construction of a power plant with three gas turbines, and a steam turbine capable of generating 650 Mw of power in the Afam region some 350 km of Abuja, the capital of Nigeria. nw

(from Left) Daewoo E&C President Park Sei-heom. A LNG plant in Nigeria built by Daewoo E&C.