Doosan Heavy Industries, South Korea’s top power equipment maker, said Friday that it swung to a net loss in the first quarter from a year earlier due to increased one-off costs.

For the January-March period, Doosan Heavy posted a net loss of 371.4 billion won (US$302 million), shifting from a net profit of 52.8 billion won a year earlier, the company said in a statement.

The company said the net loss is mainly blamed on severance payments and losses from equity ties with Doosan Bobcat Co.

Doosan Bobcat is 51 percent owned by Doosan Infracore, a leading heavy construction equipment maker and an affiliate of Doosan Heavy.

Doosan Heavy posted an operating income of 56.5 billion won in the first quarter, a sharp decline from an operating income of 322.4 billion won the previous year.

Sales gained 0.2 percent on-year to reach 3.83 trillion won in the first quarter, it added.

Doosan Heavy said it is pushing to furlough some of its employees as part of efforts to cut costs amid dwindling orders.

The company said they can receive 70 percent of their basic monthly wages during the leave, adding that the measure will not affect its business operations.

Some 650 employees have recently left Doosan Heavy in its first voluntary retirement program.

The company has received applications for its second redundancy program, though it did not provide details on how many people opted to quit their jobs.

The company has offered to pay the equivalent of up to two years’ salary to those who are eligible for the retirement program.

Those who have worked for the company for more than 10 years can receive an additional 50 million won.

Currently, Doosan Heavy has about 6,000 employees.

Doosan Heavy’s net losses deepened in recent years, as South Korea has pushed to boost the supply of power from clean and renewable energy sources while weaning the country off nuclear and coal-fired plants.

Doosan Heavy posted accumulated net losses worth 2.68 trillion won from 2014 through 2019.

Doosan Heavy said orders worth about 10 trillion won have dried up due to the cancellation of nuclear and coal-fired plant projects in South Korea.

South Korea, which decommissioned two nuclear power plants in 2017 and 2019, is set to retire 10 out of the total 24 reactors here by the end of 2030.

Doosan Heavy has recently opened two 400 billion-won credit lines with the state-run Korea Development Bank and Export-Import Bank of Korea, respectively, in the latest attempt to normalize the company.

Last month, Doosan Group submitted Doosan Heavy’s final self-rescue plans worth more than 3 trillion won to the creditors.

The self-rescue plans include the sell-off of its non-core assets, a rights issue and salary reductions of executives.

Shares in Doosan Heavy rose 0.13 percent to 3,915 won on the Seoul bourse on Friday, roughly in line with the broader KOSPI’s 0.12 percent gain. (Yonhap)