Kumho Engineering & Construction announced on the 15th that its operating profit for the first quarter of this year reached 5.7 billion won, a 380% increase compared to the same period last year. During the same period, revenue decreased by 5% to 468 billion won, while net profit turned around to 800 million won.
Kumho Engineering & Construction recorded an operating profit of 5.5 billion won in the fourth quarter of last year, marking a return to profitability, and continued this trend for two consecutive quarters into the first quarter of this year.
The cost ratio also fell by 0.4 percentage points to 95.8% compared to the same period last year, further strengthening profitability.
The liability ratio reached 648%. Since proactive loss processing in the third quarter of last year, the liability ratio has been in the 640% range. Kumho Engineering & Construction explained that liabilities increased as advance payments on construction sites rose, and that a decline in the stock price of Asiana Airlines led to a decrease in capital, resulting in a slight uptick in the liability ratio.
The dependence on external borrowing funds has decreased. By repaying borrowings of 31.4 billion won in the fourth quarter of last year and 10.1 billion won in the first quarter of this year, the total borrowing funds have been reduced to 260 billion won. As a result, the dependence on external borrowing funds fell from 19% in the third quarter of last year to 16% in the first quarter of this year.
A representative from Kumho Engineering & Construction noted, "To ensure smooth progress in large-scale plant projects such as the Gongju and Gumi natural gas power plants, the client has made early payments, leading to a temporary increase in advance payments," adding, "The increase in advance payments and the rise in liabilities or decline in capital due to the falling stock price of Asiana Airlines is temporary and will have no impact on the overall financial soundness of Kumho Engineering & Construction's business."
This representative also added, "As this plant project is a highly profitable project, as the process progresses, the advance payments will be recognized as revenue and positively impact profit improvement."
Kumho Engineering & Construction's parent company, Kumho Express, and its affiliated company, Kumho Express, are also showing signs of performance improvement. Kumho Express recorded revenue of 8.2 billion won and operating profit of 2.1 billion won in the first quarter of this year. Additionally, Kumho Express, which handles bus transportation, achieved revenue of 75.8 billion won and operating profit of 5 billion won in the first quarter.
A representative from Kumho Engineering & Construction stated, "We were able to achieve consecutive profits through thorough risk management and profitability-centered management," and added, "In the second quarter, sales from major business sites such as 'Cheongju Technopolis Atera Phase 2' and 'Busan Eco Delta Atera' will be reflected, allowing us to maintain the profit trend." The representative further noted, "As consecutive profit records continue and we are repaying borrowings, the financial structure is expected to improve even more going forward."