Samsung Engineering achieves record-breaking 2010 1H results
- 2,178.2 bn KRW in revenue, 197.1 bn KRW in operating profit, 156 bn KRW in net profit. A significant increase by 14%, 23% and 17% respectively from same period last year
- Order backlog at 16.4 trillion KRW, with new orders in 2H 2010 expected to result in double-digit growth

On July 21st, Samsung Engineering announced its 2010 half year financial results of - 2,178.2 bn KRW in revenue, 197.1 bn KRW in operating profit, and 156 bn KRW in net profit. Compared to the first half of 2009, figures increased significantly by 14.2%, 23.0%, and 17.7% respectively.

After achieving excellent results in first half of last year (2009) with revenues of approximately 2 bn KRW, Samsung Engineering surpassed this mark by posting 2,178.2 bn KRW in revenue for the same period in 2010. Considering a flood of new orders in 2H 2009 to be reflected in 2H 2010 revenues, the company is confident that it will reach its revenue target of 5 trillion KRW by 2010 and announce yet another record-breaking second half.

The hydrocarbon plant sector accounted for 82% of the total revenue, or 1,779.7 bn KRW, with overseas revenue accounting for 70%.

Operating profit amounted to 197.1 bn KRW, and increased 23.0% YoY, which outpaced revenue growth (14.2%). The YoY increase in gross profit margin 0.9%p, with SG&A expenses increased by only 0.3%p which improved operating margin by 0.6% p. Despite additional costs incurred by growth in company employees and a company-wide reimbursement for a reduction in paid vacation days, other cost improvements were made by shortening the period of delivery for projects and focusing on value engineering.

Major new order contracts in the first half include a gas and a petrochemical plant in the UAE and a Bahrain Steel mill plant with a total of 4,132.9 bn KRW in new contracts. With 38% of the 2010 new order goal of 11 trillion KRW reached, the company expects to achieve its target for this year. Considering abundant project proposal amount to $17 bn USD in the Hydrocarbon sector & $10 bn USD in the Industrial & Infrastructure sector, the outlook for 2H 2010 is positive. By June, Samsung Engineering had secured a backlog of 16 trillion KRW.

A company spokesperson stated, "We have made remarkable quantitative and qualitative growth for 1H 2010. Our strategic focus is to segue from our traditional hydrocarbon strengths and focus on new Industrial & Infrastructure businesses such as steel mills, water treatment and desalination and power plants which are currently being realized." Based on the results from 1H 2010, non-hydrocarbon revenue accounted for 18% and 36% in new orders which highlighted the future potential in this sector.

On July 20th, Samsung Engineering announced the acquisition of 1 million shares (approximately 120 bn KRW in value) directly from the market and from July 21st 2010 to October 20th 2010. In 2007 and 2008 the company executed share buy back of 1 million shares each year in order to stabilize share prices. A company spokesperson stated that, "This decision was made based on the positive outlook for future performance in order to increase shareholder value."