It is reported that higher steel costs and a decline in orders took their toll on South Korean shipbuilder Samsung Heavy Industries which posted a 10% drop in net profit to KRW 150.8 billion in the second quarter. This compared with KRW 168.3 billion between April and June 2008 period.

Operating profit rose by 19% to KRW 228.8 billion in the second quarter as compared with KRW 192.6 billion a year earlier. Sales surged by 25% YoY to KWW 3.2 trillion as against KRW 2.6 trillion a year earlier, following higher margins on more sophisticated ships.

Overall, Samsung Heavy saw net profit fall by 11% YoY to KRW 252.6 billion in the first six months of 2009, while operating profit dropped by 7.6% YoY to KRW 384.4 billion, although sales climbed by 20% YoY to KRW 6 trillion.

Samsung Heavy said that "Higher shipbuilding plate prices weighed on the second-quarter bottom line but price cuts in thick steel plates will be reflected from the second half."

(Sourced from www.lloydslist.com)