[Aju News DB]
Daewoo Shipbuilding & Marine Engineering, the world's second-largest shipbuilder, on Thursday promised to turn its troubled business around from the first quarter of this year.
Daewoo Shipbuilding CEO Jung Sung-leep apologized for the company's record net loss of 5.13 trillion won (4.2 billion US dollars) last year. But he was optimistic, saying the lifting of international sanctions on Iran will open up new business opportunities.
"I can say that Daewoo Shipbuilding faces positive conditions after enduring a crisis in the past ten months," he told reporters, admitting last year's losses were caused partly by mismanagement.
He envisioned the goal of achieving an annual operating profit of more than 500 billion won this year, compared with an operating loss of 5.5 trillion won in 2015, because the construction of offshore facilities will see a soft landing.
Daewoo's workforce has already dwindled from 50,000 in 2014 to 42,000. But Chung said it would go down further to about 30,000 without recruiting new workers.
Daewoo's trouble highlighted the continued challenges facing South Korean shipbuilders, which have shifted their strategy to focus on deep-sea drilling rigs and production facilities after the global financial crisis dampened orders and Chinese shipyards out-priced them.
Like other South Korean shipyards, Daewoo was the victim of a protracted slump in the global shipbuilding industry. Demand has been weak due to low oil prices.
In January, Hyundai Heavy Industries, the world's largest shipyard, said it would temporarily shut one of its two factories for offshore facilities by the end of March as new orders drop sharply.
Hyundai officials said the slide in oil prices had led to a decline in new orders for facilities and oil rigs.
Aju New Lim Chang-won = cwlim34@ajunews.com
reporter
Park Sae-jin
swatchsjp@ajunews.com
