Hanwha Aerospace Reports Record-Breaking 2022: What’s Next for Global Defense Exports?

Hanwha Aerospace has achieved record-breaking performance last year, fueled by its expanding global defense exports and key business successes.

On February 10th, Hanwha Aerospace reported consolidated revenue of 26.6078 trillion KRW (19.96 billion USD) and operating profit of 3.3345 trillion KRW (2.50 billion USD) for the previous year, marking increases of 137% and 75% respectively compared to the prior year. This marks the third consecutive year of record-setting performance.

The ground defense sector generated revenue of 8.1331 trillion KRW (6.10 billion USD) with operating profit surpassing 2 trillion KRW (1.50 billion USD) for the first time. Domestically, the company secured production contracts for the Long-Range Surface-to-Air Missile (L-SAM) and the Cheonggum air-to-ground guided missile for light armed helicopters. Internationally, Hanwha Aerospace clinched several deals, including the export of K9 Thunder self-propelled howitzers to Norway and Chunmu multiple rocket launcher systems to Estonia. The ground defense sector’s order backlog stood at approximately 37.2 trillion KRW (27.90 billion USD) as of year-end.

During the earnings call, Executive Director Han Sang-yun stated, “The steady growth in our ground defense and aerospace divisions, coupled with the integration of Hanwha Ocean, drove our robust performance.” He added, “Q4 sales included 26 K9 Thunder howitzers and 30 Chunmu launchers for Poland.” Han noted that they completed delivery of the initial K9 contract, with some follow-up orders meeting delivery schedules, bolstering profitability.

This year, Hanwha Aerospace projects delivery of over 30 K9 howitzers and more than 40 Chunmu launchers to Poland. The company anticipates continued growth through the supply of ancillary items, such as guided missiles for the Chunmu system, along with exports to Australia and Egypt.

The aerospace division posted revenue of 2.5131 trillion KRW (1.88 billion USD) last year, marking three consecutive years of growth. Notably, increased military orders and improved productivity helped turn the operating profit positive at 2.3 billion KRW (1.73 million USD). Annual sales of Geared Turbofan (GTF) engines surpassed 1,000 units for the first time, reaching 1,045. GTF engines, known for superior fuel efficiency and reduced noise compared to traditional turbofans, are increasingly adopted in next-generation aircraft.

The company has secured long-term growth potential in the space sector. Han stated, “We’re involved in developing and testing components for the lunar lander propulsion system, slated for a 2032 launch.” He added, “The fifth launch of South Korea’s Nuri rocket is scheduled for Q3 this year, with assembly currently underway.”

Hanwha Ocean, a Hanwha Aerospace subsidiary, was included in the consolidated financial statements for the first time, marking the beginning of synergistic integration across land, sea, and air defense sectors. Hanwha Ocean reported annual revenue of 12.6884 trillion KRW (9.52 billion USD) and operating profit of 1.1091 trillion KRW (0.83 billion USD). A Hanwha Aerospace spokesperson commented, “Last year marked our debut as an integrated defense and shipbuilding powerhouse. This year, we’ll focus on sustainable growth, global market expansion, and strengthening national security through our diverse product portfolio.”

The outlook remains positive, with a secured order backlog deliverable through 2030. Executive Director Han projected, “Revenue growth will be spearheaded by our ground defense division and Hanwha Ocean.” He added, “We expect to expand Chunmu exports from Eastern and Northern Europe to the Middle East, Asia-Pacific, and ultimately North America.”