DSME Announces Restructuring After Huge Q2 Loss

SEOUL, Aug 10 (Reuters) – South Korea’s Daewoo Shipbuilding & Marine Engineering Co Ltd stated on Monday it could promote non-core property, and shut down or exit non-essential models as a part of restructuring after a multi-billion greenback loss within the April-June quarter.

Daewoo Shipbuilding late final month reported a provisional second-quarter working lack of 3.03 trillion gained ($2.61 billion), citing building delays on offshore tasks akin to oil and gasoline rigs.

The high-end offshore plant enterprise has been loss-making for the world’s three greatest shipyards, all in South Korea, as offshore floating manufacturing services for oil and gasoline are sometimes advanced, one-of-a-kind designs that may result in unexpected building delays, analysts say.

Daewoo Shipbuilding stated it could promote the corporate headquarters in Seoul, and wind down or promote models which are unrelated to its core shipbuilding or offshore plant companies akin to wind energy subsidiary DeWind Co and native golf course operator FLC Ltd.

Its non-core companies accounted for about 10 % of the corporate’s income in 2014.

“These moves will bring in some cash and also eliminate the possibility of additional losses from the businesses that Daewoo is getting out of,” Kim Hyun, an analyst at brokerage Shinhan Investment, stated.

There was nevertheless no plan to chop employees at current, an organization spokesman stated.

Daewoo’s three largest creditor banks, state-run Korea Export-Import Bank, Korea Development Bank and the banking arm of South Korea’s largest agricultural cooperative Nonghyup Bank, are presently conducting due diligence on the corporate to find out the reason for the second-quarter losses and the extent of capital infusion that could be required.

($1 = 1,163.0600 gained) (Reporting by Se Young Lee and Sohee Kim; Editing by Muralikumar Anantharaman and Biju Dwarakanath)

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