Doosan Enerbility (034020) Q3 2024 earnings summary

Executive summary

• Orders decreased year-over-year due to a high base in 2023 and order concentration expected in Q4, but remain on track to meet annual targets.

• Revenue held steady, while EBIT improved year-over-year due to high-margin project sales and reduced SG&A expenses.

• Net profit increased, driven by valuation gains on NuScale shares.

• Debt ratio improved, aided by resolution of prior excess billing projects.

• Doosan Bobcat earnings declined due to US policy uncertainty and dealer inventory adjustments, impacting consolidated results.

Financial highlights

• Cumulative 3Q24 managerial consolidated orders: KRW 3.2tn (-45.9% YoY); sales: KRW 5.1tn (-2.2% YoY); EBIT: KRW 181bn (+3.0% YoY); net income: KRW 80bn (up from -KRW 11bn YoY).

• Consolidated sales: KRW 11.6tn (-8.6% YoY); EBIT: KRW 783bn (-33.1% YoY); net income: KRW 455bn (-KRW 99bn YoY).

• Net debt increased to KRW 3.2tn (managerial) and KRW 3.6tn (consolidated) as of 3Q24.

• Liability/equity ratio improved to 128.8% (managerial) and 122.2% (consolidated) as of 3Q24.

Outlook and guidance

• High visibility on achieving the annual order target of KRW 6.3tn, with strong pipeline from preferred bidder status and on-hand projects.

• Anticipates more than 10 orders for Korean nuclear reactors over the next five years.

• Expects significant growth in gas turbine business, with revenue projected to increase tenfold by 2038.