South Korean Shipbuilder, Container Carrier Hit Hard by Shipping Slump

South Korean Shipbuilder, Container Carrier Hit Hard by Shipping Slump
Costas Paris Aug. 15, 2018

Shipbuilder DSME’s faltering second-quarter results and HMM’s steep loss raise new concerns about shipping businesses that play an important role in South Korea’s economy

South Korean shipyard Daewoo Shipbuilding & Marine Engineering Co. 042660 1.16% and national flag carrier Hyundai Merchant Marine 011200 1.87% posted weak results in the second quarter, raising concerns about their future business despite repeated state bailouts.

Second-quarter net profit at DSME, the world’s third-largest shipbuilder, slumped 80% from a year ago to $183 million, despite a raft of orders, mostly tankers, since the start of the year. The yard made a profit of $587 million in 2017 after six straight years of operating losses and executives are hoping to end 2018 with a strong showing to set up the business for sale, people with knowledge of the matter said.

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