(LEAD) Hanwha Systems Q3 net plunges 97.5 pct on U.S. shipyard-related losses

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SEOUL, Oct. 27 (Yonhap) -- Hanwha Systems Co., the defense solutions arm of Hanwha Group, said Tuesday its third-quarter net profit plunged 97.5 percent from a year earlier due to accounting losses related to its planned sale of a U.S. shipyard.

Net income in the July-September period came to 3.8 billion won (US$2.9 million), compared with 150.5 billion won a year earlier, the company said in a regulatory filing,

The company attributed the sharp decline to accounting losses from discontinued operations at Philly Shipyard in the United States, following its decision last month to sell a 60 percent stake in the shipyard to Hanwha Defense USA Shipbuilding LLC for $237.6 million.

Operating income surged 60.5 percent on-year to 99.2 billion won, while sales rose 30.1 percent to 831.6 billion won.

The earnings fell short of market expectations. The average estimate of net profit by analysts stood at 67.2 billion won, according to a survey by Yonhap Infomax, the financial data firm of Yonhap News Agency.

The company said growth in its defense business was driven by sales of multifunction radars under contracts with the United Arab Emirates, Saudi Arabia and Iraq, as well as radar systems and other equipment for South Korea's homegrown KF-21 fighter jet.

As of the end of September, the company's order backlog stood at 8.87 trillion won, comprising 8.4 trillion won from its defense business and 469.7 billion won from its information and communications technology (ICT) division.

ejkim@yna.co.kr
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