South Korean shipbuilding major Hyundai Heavy Industries Co. (HHI) saw a 42.2 % fall in new orders for the first quarter of 2016 when compared to the order intake from the corresponding period from last year.
The value of the new orders placed at the yard during January-March 2016 totaled in USD 1.74 billion, the company said on Monday.
The company’s shipbuilding business took a big blow with 63.2% lower orderbook reaching USD 234 million. HHI’s offshore and engineering business recorded USD 149 million worth of new orders, a 74.8 % drop year-on-year.
The fall in orders was the biggest in HHI’s offshore plant construction area, with only a USD 2 million worth of orders, a 97.6 percent fall from a year earlier.
A somewhat better situation was recorded with respect to orders for engines and machinery which amounted to USD 347 million, while orders for construction equipment came to USD 415 million, down 42.6 percent and 22.3 percent, respectively.
The losing streak resumes from last year when HHI was faced with numerous delays in construction of offshore facilities and ships as the industry sector struggled with overcapacity and cost cutting measures.
The resulting price tag is KRW 600 billion (USD 523 million) in losses.
Hence, Hyundai Heavy has trimmed its appetites for this year setting its order target at USD19.5 billion in 2016, against last year’s target of almost USD23 billion.
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