LS Marine Solution is laying the groundwork for substantial external growth by securing large-scale submarine cable projects in succession.
Industry observers forecast that if offshore wind projects feed sequentially into revenue from 2027 onwards, followed by the West Coast high-voltage direct current (HVDC) business, the company can escape its previous project-dependent earnings structure and achieve what is known as "stepped growth," where revenue scales up in stages.
According to industry sources on September 28, LS Marine Solution's order backlog at the end of the first half of this year stood at approximately 660 billion won.
This represents 2.7 times the company's consolidated revenue of 244.2 billion won last year. Adding the 156.9 billion won submarine cable construction contract for the Sinan Ui offshore wind project signed this month brings the total secured work to approximately 820 billion won, or about 3.3 times last year's annual revenue.
Record interim results and expanding order backlog
Results are already showing growth. LS Marine Solution recorded first-half revenue of 148.2 billion won and operating profit of 10.3 billion won this year, marking record interim performance.
There is potential for the order backlog to grow further.
LS Marine Solution is advancing the Taean offshore wind project following Sinan Ui and has been selected as the preferred negotiation partner for submarine cable supply and construction in the Sinan Haesong - 1 and - 3 offshore wind projects. Should these projects proceed to final contracts, the order backlog will increase another step.
Stepped revenue recognition and capacity expansion
Submarine cable projects do not convert orders directly into revenue. Revenue is recognized over several years as design, construction preparation, cable loading and laying progress. When multiple large projects overlap in execution, revenue from a completed project can be succeeded by revenue from follow-on work, avoiding sharp drops in earnings.
For LS Marine Solution, offshore wind projects starting with Sinan Ui and continuing through Taean and Sinan Haesong are expected to feed sequentially into results from 2027 to 2029, followed by the West Coast HVDC business entering full construction phase.
Expansion of the domestic offshore wind market is also cited as an additional opportunity for orders. As the government pushes to expand offshore wind deployment, large-scale submarine cable construction volumes are likely to emerge on an ongoing basis.
LS Marine Solution is expanding the work capacity of its cable-laying vessels to meet growing submarine cable demand.
Its existing submarine cable-laying vessel GL2030 has completed expansion to 7,000 tons. It is scheduled to load cable at the LS Cable & System East Sea plant in October and then move to Langkawi, Malaysia.
In the first half of 2028, the company plans to deploy a new 13,000-ton HVDC cable-laying vessel.
The new vessel can load more cable in a single trip and handle long-distance submarine cable construction, enabling the company to pursue not only future West Coast HVDC projects but also large-scale overseas contracts.
Expansion into power grid and global markets
The business scope is expanding from offshore wind into power grids.
As investment in interconnectors linking power grids between nations expands globally, the long-distance HVDC submarine cable construction market is emerging as a new business domain. Based on its new large cable-laying vessel, LS Marine Solution plans to broaden its order scope beyond the West Coast HVDC to overseas long-distance submarine cable projects.
LS Marine Solution's expansion path is therefore expected to progress from domestic offshore wind to West Coast HVDC and, over the longer term, to the global interconnector market.
Industry observers see the company's growth speed as dependent on whether the order backlog converts to revenue over the coming years and whether additional projects are secured, rather than on current revenue scale alone.
Original Korean article: Pinpoint News
English brief by Korea Wind Intelligence, koreawindintel.com
