4 major South Korean defence firms set to report robust results in Q1

IANS April 20, 2025 258 views

South Korea's defence sector is experiencing unprecedented growth in 2024, driven by escalating global conflicts. Four major defence firms are projected to report substantial earnings increases in the first quarter. International demand for Korean military technologies like self-propelled howitzers and battle tanks is surging. The industry's strategic investments and export strategies are positioning these companies for significant long-term expansion.

"We aim to become a global top-tier player in the defense industry" - Hanwha Aerospace Leadership
Seoul, April 20: South Korea's four major defence industry companies are estimated to report robust earnings results for the first three months of the year on increased orders, a survey showed on Sunday.

Key Points

1

Hanwha Aerospace leads with 328.7 billion won operating profit

2

Global conflicts drive Korean defence exports

3

K-9 howitzer and K2 tank see strong international demand

The four defence firms -- Korea Aerospace Industries Co. (KAI), Hanwha Aerospace Co., Hyundai Rotem Co. and LIG Nex1 Co. -- are expected to report a combined operating profit of 657 billion won (US$461 million) in the first quarter, compared with 197.1 billion won posted in the first quarter of last year, according to a survey of local brokerages conducted by Yonhap Infomax, the financial news arm of Yonhap News Agency.

Their combined sales are projected to jump 24.5 percent on-year to 5.1 trillion won, the survey showed. Hanwha Aerospace is expected to be the best performer among the four majors.

Its operating profit is estimated to soar to 328.7 billion won in the March quarter from 37.4 billion won a year ago, while sales will jump 14.7 percent on-year to 2.12 trillion won.

Strong overseas demand for its mainstay products, including the K-9 self-propelled howitzer and Chunmoo multiple launch rocket system, drove up Hanwha Aerospace's first-quarter outlook, according to brokerages.

Global demand for Korean-made defense products has been on the rise amid the prolonged Russia-Ukraine war, escalating conflicts in the Middle East and the strategic rivalry between the United States and China.

To meet such a demand, Hanwha Aerospace said last month it will invest 11 trillion won for four years through 2028 to become a global top-tier player in the defense industry.

It aims to achieve an operating profit of 10 trillion won on sales of 70 trillion won in 2035.

Helped by strong demand for its K2 Black Panther battle tank, Hyundai Rotem looks set to post an operating profit of 201 billion won in the first quarter, soaring from 44.68 billion won a year ago.

Its sales are set to jump 71.3 percent on-year to 1.28 trillion won from 747.78 billion won.

KAI, the country's sole aircraft manufacturer, is forecast to report an operating profit of 57.3 billion won, up 19.4 percent from a year ago. Its sales are set to rise 9.6 percent to 811 billion won.

KAI expects its earnings will improve in the second half as it aims to receive 8.5 trillion won in fresh orders to build aircraft, including the FA-50 light attack aircraft and the Surion utility helicopter, in countries like the Philippines and the Middle East.

Reader Comments

J
James K.
Impressive growth numbers! South Korea's defense industry is really stepping up globally. The K-9 howitzer has been getting great reviews from international buyers. 🇰🇷💪
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Sarah L.
While the financial results are strong, I hope some of these profits are being reinvested in worker safety and ethical manufacturing practices. Defense industries have a responsibility beyond just profits.
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Mike T.
That 11 trillion won investment plan by Hanwha is massive! If they can deliver on their 2035 targets, they'll be competing with Lockheed and Raytheon. The K2 Black Panther is already one of the best tanks out there.
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Anna P.
Interesting how global conflicts drive defense sales. The FA-50 seems perfect for countries that need capable but affordable fighters. Hope the Philippines deal goes through!
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David R.
The numbers are impressive but I wonder about sustainability. Defense spending tends to be cyclical - what happens when current conflicts wind down? Still, great quarter for these companies.

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Tags:
South Korean Defence Industry Hanwha Aerospace Military Equipment Global Arms Trade Defence Exports
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