South Korea’s major defense companies reported record first-half earnings, driven by strong export demand, according to industry data released on Sunday.
According to Korea Times, the combined operating profit of Hanwha Aerospace, LIG Nex1, Korea Aerospace Industries (KAI), Hyundai Rotem and Hanwha Systems reached 2.3 trillion won ($1.67 billion) between January and June. This marked a 161 percent increase from 880.7 billion won during the same period last year and accounted for nearly 80 percent of their full-year operating profit in 2024.
Total sales nearly doubled year-on-year, rising from 9.9 trillion won to 19.2 trillion won.
Hanwha Aerospace reported an operating profit of 1.43 trillion won, more than four times higher than last year’s 355 billion won. Sales increased more than threefold to 11.8 trillion won. LIG Nex1 recorded a 64.6 percent rise in operating profit to 191.2 billion won, with sales climbing 35.4 percent to 1.9 trillion won. Korea Aerospace Industries (KAI) posted 132 billion won in operating profit, up 7.9 percent, though sales declined 6.4 percent to 1.5 trillion won. Hyundai Rotem achieved a 192.4 percent increase in operating profit to 460.4 billion won, while sales grew 40 percent to 2.6 trillion won. Hanwha Systems reported a 29.5 percent fall in operating profit to 91.6 billion won, despite an 18.4 percent sales increase to 1.5 trillion won.Industry officials attributed the surge to overseas demand amid geopolitical tensions in the Middle East and Europe.
Hanwha Aerospace’s overseas sales in the second quarter rose 43 percent year-on-year, supported by exports of systems including the Chunmoo multiple rocket launcher.
Hanwha Systems saw an 11.8 percent increase in second-quarter sales, largely from delivering multi-function radars for the Cheongung-II medium-range surface-to-air missile system to the United Arab Emirates and Saudi Arabia.
KAI reported 227.3 billion won in overseas sales for the second quarter, driven by exports of FA-50 fighter jets to Poland and Malaysia.
The five companies’ combined order backlog stood at 111.9 trillion won as of mid-year. Market observers expect this to sustain growth in the second half.
“With continuous overseas orders for flagship products and deliveries, we have a positive outlook for the second half of the year and beyond,” an industry official said on condition of anonymity.
