President Kim Hyung of Daewoo Engineering and Construction Co. (Photo: Daewoo E&C)

Daewoo E&C released an electronic filing on the contractor’s business performance for the whole of 2020 on Jan. 28.

Daewoo E&C posted 13.912.6 trillion won in new orders, 8.136.7 trillion won in sales, 558.3 billion won in operating profit, and 282.6 billion won in net profit for the whole of last year.

In particular, the contractor achieved an earnings surprise surpassing market consensus by chalking up 253.3 billion won in operating profit for the fourth quarter of last year, a some 465 percent jump or an increase 44.8 billion won over the same period of the previous year.

Daewoo E&C logged 13.912.6 trillion won in new orders during the whole of last year, achieving a 109 percent of its annual goal of 12.77 billion won, set early last year.

The figure represents a 30.8 percent surge or a jump of some 3.3 trillion won over the same period of the previous year when new orders worth 10.639.1 trillion won were won.

The contractor logged ample backlog orders worth 37.779.9 trillion won. It means that Daewoo E&C has secured 4.6 years of backlog work compared to its annual sales.

The contractor saw backlog orders surge some 4.9 trillion won or 14.9 percent over the end of 2019 when they stood at 32.882.7 trillion won.

A Deawoo E&C official said despite the sagging global economy and inside and outside uncertainties, caused by COVID-19 pandemic, the contractor had proved its superb construction capabilities and global competitiveness by landing a streak of mega-projects such as Nigeria’s Train 7 project worth 2.1 trillion won, Iraq’s Alpo new port project worth 2.9 trillion won, and Mozambique’s LNG Areal project.

Daewoo E&C Runs Away with Mozambique LNG Project

Daewoo E&C won an LNG liquefaction complex project in Mozambique, the contractor said on Dec. 23.The Mozambique LNG Area 1 Project calls for building two LNG liquefaction trains with an annual production capacity of 6.4 million tons and auxiliary facilities.

Daewoo E&C will be responsible for the construction of the “Process Area,” such as steel structures, mechanics, piping works, electronics instruments.

Seven companies, including the global petroleum company Total of France and Mozambique’s state-run gas company, are involved in the project. Its construction period is 33 months. Mozambique, located in southeastern African, boasts of rich coal reserves ranking ninth in the world.

The World Bank Group sees a potential of great economic spillover effects from Mozambique’s natural gas development, so additional orders on the construction of multiple LNG liquefaction trains, gas generation plants, petrochemical plants and agricultural chemical plants are expected.

As a result, Daewoo E&C is expected to be in a better position to secure an upper hand and expand its presence in the African market by making the most of its abundant construction experience and technology expertise, as the Korean contractor seizes the latest opportunity.

Daewoo E&C, designating the LNG business sector as one of its future growth engines, is stepping on the gas to land additional orders through sales activities tailored to meet orders in major mega-markets such as Nigeria, Qatar, Indonesia, Russia, and Papua New Guinea.

If Daewoo E&C wins the Iraqi project, the contractor is predicted to surpass its overseas order goal for this year.

Daewoo E&C is mostly likely to see a turnaround in sales for next year on the back of this year’s winning of highly profitable, good quality overseas orders. The contractor plans to accelerate efforts to land overseas projects by making the most of its strengths.

Meanwhile, Daewoo E&C has made a strong showing in the overseas business sector so far this year. The contractor ran away with successive mega project orders, amounting to a combined more than 3 trillion won, including Nigeria’s LNG Train 7 Project worth over 2 trillion won, and ones in countries such as Vietnam, Singapore and Hong Kong.

In a related development, Daewoo E&C has won a $2.625 billion order to build the first phase of a new port in Al Faw in southern Iraq, reports said. A formal signing of the deal is to be done in early next year.

According to Daewoo E&C, the Iraqi cabinet approved a government plan, including one calling for allowing the Korean contractor to be charged with a project to build the first phase of the new port of Al Faw. Daewoo was awarded the construction of approach roads and berths, part of the first phase project.