STX Sets Long-term Vision

STX Chmn. Kang to focus on construction, energy, shipbuilding, machinery, green energy, plant, among others for the group’s 2nd decade of growth

STX Group set its business target for 2010 at 25 trillion won in total sales, 33 trillion won worth of new project orders and 1 trillion won in net income, the group announced on Dec. 29.
The target for new orders set at 33 trillion won is compared to the 16 trillion won estimate for 2009, and the sales target is up 9 percent from last year.
The ambitious targets show Chairman Kang Duk-soo’s strong intention to turn to an offensive style of operation with this year being the group’s 10th year since its founding and the initial year for the group’s ’second jump in growth plan’ through 2020, group officials said.
Chairman Kang, as an average-salaried man, began buying shares of Ssangyong Heavy Industries in 2001 to add to the 1,000 shares he received as a bonus from the company. He finally took over the company and changed its name to STX Heavy as the mother company of the STX Group. Kang took over a number of other companies through M&As. Soon the group grew big enough to expand its annual sales to 20 trillion won in its first 10 years of operation in the “magic” hands of the chairman.
The next 10 years are a crucial period for the group as it seeks to make another big jump in its operations by focusing on new lines of business such as energy, plant and other areas of construction, in addition to shipbuilding, machinery and maritime transportation, the main business areas that acted as locomotives for growth for the group.
“This year will be a new turning point for the group in its move toward the global market to be a best global enterprise ― one of the best business groups in the world,” Kang declared.
The group already captured a residential housing construction project worth $10 billion in Ghana as a result of Kang’s management style to work closely with what’s happening at jobsites. Kang said he found the answers to various problems he faced while visiting jobsites.
The chairman will now steer the group to make inroads into Africa, Central and South America, Russia and the Middle East to push its energy, construction, plant and natural resources development projects in those regions. He will run the group to seek not only projects by its affiliates, but package projects that will link a number of affiliates in undertaking the projects.
Chairman Kang set key areas that each sector should focus on this year; the shipbuilding and machinery sector to maximize synergy among the shipyards in Busan and Jinhae, Korea, and Dalian, China, and STX Europe with shipyards in 15 locations in Europe including France, Norway and Finland. Kang wants the marine plant and special vessel sector to boost its order receipts to 14 trillion won this year for that sector.
The maritime transportation and trade sector will be responsible for posting total annual sales of 9 trillion won, taking advantage of STX Shipping’s early turnaround from the slump that hit the global maritime shipping industry from last year. The sector will be led to seek long-term shipping contracts by strengthening strategic ties with the world’s major cargo owners in order to secure a stable base for profits and to diversify and supplement its global network.
The group will make the plant, construction and energy sector its future growth engines, construction in particular since securing the $10 billion housing construction project in Ghana.
The energy sector will continue to undertake resources exploration, new and recycled energy and power generation plants as its future growth engines, group officials said.
In the meantime, the group said it has secured a wind power plant project worth $300 million euro, which is the first one since the group decided to enter the green energy business by launching STX Wind Power after taking over Haracosan Europe and renaming it six months ago.
The project involves the construction of various wind power plants in Eastern Europe. STX will build 140 2W and 1.5W-class wind power plants by 2013 in such countries as Poland, Romania, Czech Republic, Bulgaria and Hungary. The company already won the wind power plant construction project to build six wind power plants in Romania.
STX Solar has also been progressing well as its solar battery plant was completed in Gumi, North Gyeongsang Province, which will turn out 50Mw of solar batteries annually. The plant will produce 300Mw of solar batteries in 2014 to bring annual sales to 500 billion won at an additional investment of 200 billion won. nw

Chairman Kang Duk-soo of STX Group.