Good afternoon. First of all, thank you all for joining this conference call. Now we will begin the conference of the fiscal year 2026 third quarter earning results by HD Korea Shipbuilding & Offshore Engineering. This conference will start with a presentation followed by a divisional Q&A session. Now we shall begin the conference of the fiscal year 2026 third quarter earning results by HD Korea Shipbuilding & Offshore Engineering.
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Good afternoon. I am Sung Gi-jong, Executive Director overseeing IR for HD Hyundai Group. As in the previous quarter, we will keep today's earnings presentation as brief as possible and allow more time for Q&A. English interpretation will be provided consecutively. After the earnings presentation, I will comment on the shipbuilding market before moving on to Q&A. Let me begin with the key highlights for the third quarter, followed by our operating results.
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First, the FX impact. The average exchange rate in the third quarter fell by approximately 6%, or by KRW 79 from the previous quarter, resulting in an operating loss impact of approximately KRW 70 billion, which includes KRW 45 billion for Hyundai Heavy Industries.
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Second, one-off costs. Hyundai Heavy Industries recorded 47 working days in the third quarter, a decrease of approximately 14 days quarter on quarter. This represents about four more days than the typical seasonal decline, and the additional reduction lowered operating profit by approximately KRW 50 billion. Regarding the wage and collective bargaining agreement, which we successfully concluded yesterday, we recognized approximately 75% of related one-off costs in the third quarter, with the remainder to be recognized in the fourth quarter. As the specific amount has yet to be finalized, we ask for your understanding that we are unable to disclose it at this time and kindly ask that you refer to relevant reports for further details.
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See our product mix by vessel type as follows. At Hyundai Heavy Industries, large-size carrier 42%, LPG/BC 3%, container 4%, tanker 5%. Medium-size segment, container ship counted 24%, carrier 3%, LPG carrier 6%, bunker 8%. At HD Samho, the carrier 40%, container ship is 32%, tanker 14%, and LPG carrier is 10%, with significant change from previous quarter.
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We apologize for the inconveniences caused by the technical issues that interrupted the conference call. The investors' understanding for the conference will be very appreciated.
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Apologies for the technical glitch. Let me resume. Second, one-off costs. Hyundai Heavy Industries recorded 47 working days in the third quarter, a decrease of approximately 14 days quarter-on-quarter, and this represents about four more days than the typical seasonal decline, and the additional reduction lowered operating profit by approximately KRW 50 billion. Regarding the wage and collective bargaining agreement through which we produced the desirable outcomes yesterday, we recognized approximately 75% of the related additional costs in the third quarter, with the remainder to be reflected in the fourth quarter. We are unable to disclose the specific amount, and we kindly ask that you refer to relevant press reports for further information.
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Finally, our third quarter revenue mix by vessel type. HD Hyundai Heavy Industries large-sized ships: LNG carriers 42%, LPG carriers and VLACs 23%, container ships 24%, tankers 9%. For the mid-sized ship segment, container ships accounted for 24%, product carriers 33%, LPG carriers 26%, and bunkering vessels 8%. HD Hyundai Samho: LNG carriers 40%, container ships 32%, tankers 14%, LPG carriers and VLACs 10%, with no significant change from the previous quarter.
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Moving to page four, here are the consolidated results for HD KSOE. Consolidated revenue decreased 7.2% quarter- over-quarter and increased 9.3% year- over- year. Despite the continued rise in vessel prices, revenue declined slightly from the previous quarter due to seasonal factors, fewer working days, and a lower exchange rate. Operating profit decreased 12% quarter- over- quarter, and increased 37% year- over- year, reflecting the lower exchange rate, fewer working days, and higher one-off costs. I will cover the non-operating items later in the presentation.
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Please refer to the table on page five and let me move on to page six. Consolidated revenue in the shipbuilding division decreased 8.2% quarter- over- quarter and increased 10.3% year- over- year. The quarter- over- quarter decline reflected fewer working days and a lower exchange rate despite higher vessel prices. On an HD Hyundai Heavy Industries basis, consolidated revenue in the naval and special vessel segment decreased 14.6% quarter-over- quarter and 30.8% year- over- year. The decline was mainly attributable to fewer working days and a change in project mix.
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In the offshore segment, the Ruya project continued to ramp up while the Trion project entered its final stage. As a result, revenue increased 1% quarter- over- quarter and 35% year- over- year. Next, engine and machinery revenue was flat quarter- over- quarter and decreased 10.3% year- over- year, mainly due to fewer production days and a lower exchange rate.
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Moving to page seven, I will now cover operating profit by business segment. Shipbuilding operating profit decreased 18.1% quarter- over- quarter due to the lower exchange rate and one-off costs but increased 32.3% year- over- year. The operating margin was 16.7%, slightly lower quarter- over- quarter, but continuing to improve year- over- year.
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Operating profit in the naval vessel business increased sharply 114% quarter- over- quarter despite lower revenue, supported by a higher export mix, but decreased 24.5% year- over- year. Offshore operating profit surged 110% quarter- over- quarter and turned profitable year- over- year, supported by the full-scale recognition of revenue from the Ruya project and KRW 18 billion in change orders.
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Engine and machinery operating profit continued to grow, increasing 8% quarter- over- quarter and 19% year- over- year. Higher selling prices and a greater share of Dual Fuel engines more than offset the lower exchange rate and reduced revenue. It is for the first time that we disclose our revenue from onshore power engines, which is approximately KRW 11.4 billion this quarter.
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Please refer to page eight for the operating results of the consolidated subsidiaries, and I will provide more detail on page nine. First of all, HD KSOE on a standalone basis. Higher revenue from the SD business division and overseas yards helped the company return to profit, while dividend income also contributed to a significant increase in operating profit.
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HD Hyundai Heavy Industries Its revenue decreased 9.1% quarter-over-quarter and operating profit declined 13.5% quarter-over-quarter due to fewer working days, a lower exchange rate, one-off costs, and a change in vessel mix, including a lower share of LNG carriers. The engine and machinery offshore and naval and special vessels businesses nevertheless delivered a stable operating result. Now, HD Hyundai Samho, despite fuel production day, which were around 10 days lower from the previous quarter, and the lower exchange rate in the third quarter, the company continued to deliver solid operating results, supported by an higher share of LNG carriers and continued productivity improvements. Revenue remained at the previous quarter's level, while operating profit decreased 10.3%. The operating margin was 20.2%.
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Let us move on to page 10. HD Hyundai Marine Engine. Despite the lower exchange rate, revenues surged 65% quarter- over- quarter, and operating profit increased 92% quarter- over- quarter, driven by effective FX hedging, higher selling prices, an increased share of dual fuel engines, and higher delivery volumes. The operating margin came in at 28.5%, which is the highest in its history. Next is HD Hyundai Energy Solutions. Despite the seasonal slowdown and the lower exchange rate, revenue increased 24.6% year- over- year, and operating profit rose 38.8% year- over- year, supported by higher selling prices and increased exports to the United States.
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On page 11, non-operating results included approximately KRW 610 billion in foreign currency related losses following the sharp decline in the USD/Korean won exchange rate, as well as KRW 307.8 billion in gains on financial instruments. On page 12, all subsidiaries remain in net cash position with consolidated net cash of approximately KRW 11 trillion.
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And that concludes our presentation of results for HD KSOE and its subsidiaries. We will now walk you through the outlook for the commercial shipbuilding market.
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Good afternoon. I am Kim Gwang-woo, Senior Executive Director in charge of HD KSOE Strategic Marketing Division. I will now walk you through global new building market trends for the third quarter of 2026, and the order intake of HD KSOE shipbuilding division. First of all, market trends.
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From January to September this year, the global new building market saw very strong ordering activities across all vessel types, reaching a record high that surpassed the same period of 2007, the previous peak in terms of GT.
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In the third quarter, container ships led the market while solid ordering momentum continued across a range of vessel types, including tankers, which had been strong since the start of the year, as well as LNGC, LPGC, bulker carrier and car carrier.
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Geopolitical risks, including the wars in the Middle East and Ukraine, persist. Disruptions to shipping logistics caused by factors such as transit restrictions in the Panama Canal are deepening the supply-demand imbalance in the shipping market. Against this backdrop, a combination of factors including unprecedented shipping market conditions, a growing focus on energy security, response to environmental regulations, and demand for replacing aging fleets, is having a significant impact on the new building market as well. Global new building investment this year has already approached last year's full year level as of the third quarter, reflecting unexpectedly strong demand for new building investment. New building prices also continue to rise, driven by sustained ordering from ship owners who have secured substantial profits and by shipyards' accumulated backlogs.
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Lastly, our new order trend. The group's shipbuilding subsidiaries secured a total of 176 vessels worth $19.1 billion on a cumulative basis through the third quarter, exceeding our annual order target. This result reflects the success of our selective order-taking strategy and our sales efforts focused on high value-added vessels, and once again demonstrates the group's competitiveness in winning orders in the global market.
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In terms of our new order portfolio, we secured a number of high value-added large gas carriers. In particular, we won a total of 45 VLGCs, including VLACs on a cumulative basis through the third quarter, capturing more than 50% of global orders. In the mid-size segment, we diversified our order portfolio by winning orders across a wide range of vessel types, including not only medium range and long range two tankers, but also mid-size and large LPG carriers, liquefied CO2 carriers, PCTCs, and roll-on and roll-off vessels.
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Last but not least, the market outlook. Going forward, the shipbuilding market has favorable factors, including limited capacity in major shipyards, steady growth in seaborne trade volumes, and demand for replacement with eco-friendly vessels. At the same time, risks remain, such as geopolitical tensions, uncertainty in the global economy, and expansion of shipbuilding capacity worldwide.
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In this environment, the group will continue its order strategy focused on high value-added vessels, leveraging our extensive shipbuilding experience, technological capabilities, and stable supply chain. We will also respond more flexibly to market changes and customer needs, striking a balance between profitability and growth. This concludes our presentation of HD Korea Shipbuilding & Offshore Engineering third quarter 2026 results. Thank you for your attention.
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Now Q&A session will begin. Please press star three if you have any questions. Questions will be taken according to the order you have pressed the number star three. For cancellation, please press star four. Star and four on your phone.
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The first question will be presented by Korea Investment Securities. Please go ahead.
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I have three questions about your engine business. The first question is you mentioned that your engine business revenue for this quarter is KRW 951.1 billion. Can you give us a breakdown of this revenue by low speed, mid speed engines, and then pipes and components? The second question is about your onshore power generation engine. As you said, what is it for?
We have two cases of H54GV and H35/40GV. Is it for large output power generation engine, or is it an engine that is used for usual onshore power generation? Can you also give us the classification or distinction? Lastly, out of the inquiries that you have received this year, are there anything that would give you visibility in terms of actually being awarded any contract? It's because we need to ensure a bit of visibility about the 4 GW facility utilization that you mentioned.
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For your first question, if I give you our revenue breakdown, the large size engine will be 50%, and mid-sized engine, which also includes power generation one, 35%, and the other category 15%.
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To answer your second question, I am Son Won Sik from the engines business. As to the power generation engine project, we have been quite steady in undertaking existing projects, which amounts to 100 - 300 mega project. These orders were given two to three years ago, and this is ongoing. As for now, as to the ones that you mentioned, the H54GV and 16H54GV, we cannot produce these engines with our Ulsan factory alone. The production will be made feasible when we have a new plant ongoing. There's going to be a split of production between our existing plant and our Mokpo plant.
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To answer your third question, which was about inquiries, we have both PPP then the Helipad projects, 1.6 GW, which were already disclosed, but we have 1.4 GW projects which we are undertaking internally, but we haven't disclosed these projects because they did not meet disclosure criteria. By year, we would be operating at our full capacity by 2028 and 2029. As to additional order awards, we need to see what's going to be happening. As I mentioned last time, we have continuing demands in the AI data center sectors as well as national electricity grid development.
As you know, electrification is a global trend, so we continue to receive inquiries about national grid development as well as AI data centers. What's different is previously, AI data center projects had been undertaken with us serving as an intermediary, so there would be demands, but they would come through intermediaries. These days, hyperscalers tend to come to us directly and contact us directly. That's one difference. Our strategy would be to strike the right balance between our capacity and projected revenue and our order-taking capabilities.
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The power generation volume that are quite firm or that are projected is going to be 1.5 GW in 2028 and 3 GW in 2029.
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The next question will be presented by Jeong Dong-ik from KB Securities. Please go ahead.
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I have two questions. The first question is about offshore plants. You mentioned there's a one-off gain of KRW 18 billion, and that's very high because that's almost a 30% increase in operating profits. And in the previous quarter, your OP margin in offshore plant was also 16%. I think these are unsustainably high levels of operating profits. I'd like to know the background or logic behind these two consecutive quarters where very high margins were made available. And what's your view on the following quarter or next year in your offshore plants?
My second question is about your commercial vessel market outlook. As you mentioned, this year's ordering activity was the highest ever, maybe better than what was recorded back in 2007. Then how do you view 2027, next year? Because Clarksons estimated and forecast that there's going to be around a 30% decline in the overall market. I wonder what your internal view is about the commercial ship market next year.
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To answer your first question, yes, that's KRW 18 billion in change order, and that's recognized as revenue. We have the Trion and the Ruya projects, and the Ruya project specifically is proceeding at its full capacity. These two projects are very high margin ones. Aside from these, there is nothing specific that I would like to mention. In the following quarter, in Q4, on the Trion project, revenue may decline a bit, but the Ruya project will be making good progress.
Again, in the following quarter, we believe we can produce profits with high margin. In the offshore sector, we don't believe we will be suffering losses or any sudden drop in our revenue. Revenue may decline slightly in 2027, but I think we will be able to produce a profit, because we would be considering block construction as well as LNG inputs as well, in preparation for any possible decline in our offshore business.
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Let me give you my answer to your second question as to the market prospect, especially new build orders for 2027. For this year, it was around 190 million. That was above the 176 million that was recorded before. As you said, Clarksons is expecting around 30% reduction, and that would be amounting to 125 or 130 million tons in 2027. Still, the level is quite high compared to usual years. Beyond 2027, yes, new build orders may decline compared to 2026, which was the highest ever in history.
Still, we expect a solid market outlook in these new build activities. There are several reasons why. First of all, we are experiencing supply chain disruptions because of transit restrictions on the Strait of Hormuz, the Panama Canal, and the Suez Canal, and this leads to increases in ton mile, the overall ton mile, which spikes demand for new builds as well. Ship owners have the financial capability, and they can afford investing in new vessels as well.
That increases demand for new builds. Even though this war in the Middle East comes to an end, we believe supply chain disruption will be established as a new normal, which means there won't be big changes in seaborne trade volumes. In 2027, yes, there could be a slight reduction, but still we believe that we're going to have solid performance in the new build market.
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I'd like to make some additional comments about our offshore plant business. Both the Ruya and Trion projects are increasing their contribution to our overall revenue, and these two projects are highly profitable, and that's our expectation. So until they are fully delivered in 2027, these two projects will be producing desirable outcomes with improvement in our overall profitability.
But as to additional orders and additional projects beyond these two projects, in fact, earlier this year, we were working on a project in the Middle East, which did not lead to successful outcomes. But there are some new projects that we haven't disclosed yet but are ongoing. For instance, there's an offshore substation project, and all the work is already being done, but due to contractual reasons, we're not disclosing this project. And we also have a gas production facility project for which all the work is ongoing as well. So I believe early 2027, we'll be able to disclose relevant information about these subsequent projects.
And as to our offshore energy business, I think all projects would be, and are being undertaken just as planned, so they would be producing profits just as planned as well. And behind this stellar performance lies our selective order-taking strategy, which focuses on profitability as well as our excellent execution, which ensures that these projects are undertaken just as planned.
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The following question will be presented by Choi Kwang-sik from Daol Investment Securities. Please go ahead.
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My first question is, please give us an updated vintage year for your order-taking activities for the third quarter. That's the first question. And the second question is about your projected joint venture in the United States with Kiewit. Your company has been rather conservative, but you are now pursuing this block manufacturing operation or joint venture with your U.S. counterpart, which is Kiewit. Without an amendment being made to the Jones Act or Byrnes-Tollefson Act, many people are concerned that such projects or business may entail greater risks. I'd like to know more about the background behind making this rather bold investment decision, and who are the major players in this joint venture or future U.S. operations? Is it going to be six subsidiaries of your group?
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If I give you updated vintage year data, first of all, Samho, 28% for 2023, 48% for 2024, then 24% for 2025. Now Hyundai Heavy Industries mid-sized ships first, 9.6% for 2023, 55% for 2024, then 25% for 2025. Now large-sized ships for Hyundai Heavy Industries, 4% for 2022, 45% for 2023, 31% for 2024, and 20% for 2025.
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To answer your second question as covered by media press. We have established a joint venture with the U.S. company Kiewit, and the intention is to establish a local manufacturing footprint in the United States. The MOU was signed back in July, and as a subsequent step, the joint venture was established. Our goal is — as to combat ships, that would require further discussions. But we're making preparations so that we can receive orders for logistic support ships from the U.S. Navy or MARAD. That would include consult tankers, for instance.
As to the background behind this investment decision, back in August through the presidential memo published by the U.S. government, foreign shipyards who will be making investments on U.S. soil, U.S. territory, would be subject to Bridge Strategy provisions, which would make investment in the U.S. possible. We believed that without establishing a local manufacturing footprint, we won't be able to have business opportunities for the United States market.
And that prompted our investment decision. But as to who's going to own this project, whether that's going to be six to four, nothing's decided yet. But according to the Wall Street article, which covered Hanwha's Philly Shipyard, the investment volume or the production volume should be secured first before we finalize any level of investment to be made in the United States. Internally, we have looked at several scenarios, and we have our own calculations made internally. With the U.S. Navy and with the U.S. government, we are currently making discussions on details, on detailed volume.
And if that's determined, then that will determine the level of investment they will be making and who's going to be owning these businesses as well. And internally, our plan is to finalize things by the end of 2026, and then after that, we will be able to make official disclosures or announcements about our U.S. business.
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The following question will be presented by Lee Dong-heon from Shinhan Investment Securities. Please go ahead.
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We have three questions. Basically, the first question is, we saw a surge in operating profit for Hyundai Marine Engine, and I wonder whether this is sustainable or not. That's my first question. The second question is about your new venture, joint venture in the United States. As far as I know, Kiewit doesn't have any track record in building naval ships. So in association with your partnership with Huntington Ingalls Industries, what's going to be the role of Kiewit? What's the division of roles among these companies? The third question is about your floating data center project. I heard that there are some delays in your discussion with big tech companies as to onshore engine business. Any update about your floating data center projects?
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To answer your first question, yes, Hyundai Marine Engine demonstrated stellar performance this quarter. As I mentioned in the previous quarter, there were two units that were not delivered, which were supposed to be delivered in Q2, and these were recognized in this quarter. That's part of the reason. There are some deliveries that have been recognized in Q3, which are supposed to be recognized in Q4, the following quarter. And for an exchange rate, the Korean won will be depreciating further, we believe, and we have an increasing share of dual-fuel engines as well.
Overall, we expect excellent performance from Hyundai Marine Engine. Our goal was to achieve 100% utilization rate, but utilization rate already exceeded 110%. We need to consider a weaker Korean won in the following quarter. Given all this, improving productivity, increasing orders, and increasing share of dual-fuel engines, and increasing ASP, you may guess how Hyundai Marine Engine's performance will be, which we believe will be improving further.
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To answer your second question, yes, the company Kiewit has not been involved in the shipbuilding sector previously, but Kiewit is a leading EPC company in the United States. It's a sizable company, and it has excellent track records in the EPC business, and the company has long been involved in offshore plant business as well. Internally, Kiewit wanted to expand its business from offshore plant to shipbuilding. The willingness of the company, Kiewit, and its very natural fit with our company, a combination of factors worked behind this investment decision.
Previously, we looked at several shipyards in the United States as a target of acquisition, but we realized that their facilities were aging, and we needed to optimize our logistics operations as well. Acquiring an existing shipyard was almost tantamount to building a new one in terms of CapEx. As a result, those U.S.-based shipyards were demanding a higher price for acquisition.
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In addition to that, offshore plant companies share many foundational technologies with shipbuilding companies. In that sense, we share technological capabilities between our two companies, and that makes Kiewit a very good partner in terms of producing synergy, both in terms of staffing and talent development and training as well. With Kiewit, we're going to be focusing on basic naval vessels first. For example, while building two vessels here in Korea as the initial delivery, we would be making CapEx investment in the United States to build the necessary facilities. With Huntington Ingalls Industries, we're having discussions with the company to look at the possibility of block construction. As to combat ships, I think there is a need for further discussion.
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Your third question is about nuclear submarine business. Currently, there's a special bill which is pending at the National Assembly of Korea. Discussions are ongoing at the National Assembly level. For the first time, nuclear submarine budget has been allocated for the year 2027. It means starting from next year, the nuclear-powered submarine project will begin here in Korea, and we're making necessary preparations for that. Given the duration and the scale of constructing nuclear submarines, it cannot be done by any single company alone. It requires that there are national-level capabilities mobilized. We are planning to propose to the Korean government that not just the shipbuilding companies, but there should be other adjacent industry companies that come together to make this project possible.
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To answer your question about floating data centers. Between KSOE and Hyundai Heavy Industries, discussions are ongoing among our group affiliates. And not just the data centers themselves, but we believe we have the potential to produce synergy as to data center equipment and facilities as well.
And at the group level, we believe we have the capability to supply these equipment pieces as well. But as to ship level capability for FDCs, we are internally discussing which yard will be responsible for building such FDC vessels. And it requires BMPP. We have currently available technology, BMPP technology, already in the market, which means we are capable of supplying necessary engines. But it concerns large-scaled engines, for example, 20H35/40GV or 16H54DFV. So we have the technology to supply these engines. That's what I can tell you.
About whether the maturity of floating data centers themselves, we are not 100% sure, but we have ongoing discussions with hyperscalers, and it's for sure the demand is growing for floating data centers. One of our concerns will be about power source, because it may vary compared to what our industry peers have in mind. But for FDC, we need BMPP. And here, we believe we have room to apply our HiMSEN engine.
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The following question will be presented by Choi Kwang-sik from Daol Investment Securities. Please go ahead.
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I have two questions. The first question is about your LNG business. Your company share price has decreased recently, and Chinese shipyards are increasing their market share, especially in the LNG sector. And these Chinese companies are one of the reasons why LNG vessel prices are going down.
That's what some people say. And these Chinese shipyards are gaining orders not just from domestic clients, but from overseas clients, including MISC as well. So price-wise, Chinese shipyards are not demanding as much as Korean shipyards. Still, the Chinese shipyards are increasing their influence in awarding orders for LNG vessels. So can you give us any update about this market situation? I'd also like to know what your take is on the decreasing LNG vessel prices, as well as increasing Chinese shipyards' influence in this market segment.
My next question is about the HiMSEN engine, which will be allocated for data center applications. You mentioned a 1.4 GW project, but according to the monthly engine IR data, I don't believe we have seen increases compared to the previous year. So when you mention specific gigawatt numbers, does it reflect the orders that are already recognized in your book or orders that you are expecting as well?
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In the LNG market, yes, it's true that Chinese shipyards are increasing their orders in the global LNG market. On a YTD basis, these Chinese shipyards have secured 32 vessels. Three shipyards in China — Hudong, Jiangnan, and Hengli — but aside from Hengli, Hudong and Jiangnan are our direct competitors across the global market. One of the reasons why they are successful is significantly lower prices compared to ours.
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In spite of that, if we deep dive into the orders these Chinese shipyards have taken this year, then they are mostly coming from Chinese ship owners and Chinese projects. As to the 10 LNG vessels, they were awarded by MISC. Its parent company is Petronas. Petronas deals with Chinese ship owners primarily. So it's rather inevitable that the shipping company chose a Chinese shipyard in awarding its LNG ship order.
For us, Korean shipyards, we are producing industrial-level LNG carriers, which means our clients want supply chain stability, reliability, and unfettered access to any ports across the globe, whether it is the U.S. or other countries. So this universal access is critical. That's why our global company's clients like to work with Korean shipyards, including our company. On a life cycle perspective, I think Korean LNG shipbuilders are competitive across the global market.
Yes, LNG ship prices have gone down, partly because of the impact from China and as well as decreasing orders themselves. I don't think the prices will go down any further. Ship owners already recognize the current level as the bottom. Behind the scenes, they are very much interested in new LNG ships, and they are in discussion with Korean shipyards.
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As you know, LNG produced in Qatar has decreased, which means ship owners are less active in making new investment in LNG. There are ongoing, very active LNG projects across the U.S. and Canada, and they are going on right now. We believe that in 2027 that is the reason why LNG new build projects will begin starting from 2027. I'd like to mention LPG as well, which had a record high year this year.
On a daily basis, it used to be $30,000 - $40,000, but currently it's $240,000, even $250,000 on a daily basis. Ship owners are taking interest in LPG as well. At our company, we're taking a proactive stance towards LPG, developing technology and putting the necessary effort into this market, and our efforts are being translated into actual outcomes. Next year, our progress on LNG and any resumed project on LNG, these would certainly contribute to our business success, I believe.
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If I make additional comments about our engine ordering activities, the 1.4 GW project, so most of the projects that we have won are reflected in our disclosures that we make. But in 2024 and 2025, it was mostly vessel-grade engines, and during those years, our performance was great.
But it was back in 2023 that vessel demand was at its highest. So as a result, in 2024, we had a record high year in terms of orders that were awarded, and that meant our backlog amounted to 3.5 years or even more. So our slots would be full until 2028, and which means some of them would be fully occupied by 2030 as well. So even though it seems that our order activities are not as strong as before, we have enough backlog to address. And if our onshore engine demand increases, that means that in our engine and machinery business, both our ordering activities and our revenues would be great.
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This concludes our earnings presentation. Thank you very much for your participation.