Hanon Systems (A018880) Q1 2025 earnings summary

Executive summary

• Revenue grew 8.9% year-over-year to KRW 2,617B, driven by favorable FX and higher sales volume.

• Operating profit margin dropped to 0.8% due to changes in R&D capitalization and increased D&A.

• Net income turned negative at KRW -23B, impacted by net interest expense and other below-the-line items.

• XEV revenue ratio reached 27% in 1Q25, with expectations to hit 30% for the full year.

Financial highlights

• Revenue: KRW 2,617B (+8.9% YoY, +3.2% QoQ).

• EBITDA: KRW 191B (-14.2% YoY, +493.5% QoQ); margin 7.3%.

• Operating profit: KRW 21B (-68.5% YoY); margin 0.8%.

• Net income: KRW -23B (vs. KRW 10B YoY); margin -0.9%.

• COGS as % of sales increased to 92.7% (from 90.8% YoY).

Outlook and guidance

• XEV revenue ratio expected to reach ~30% in 2025, supported by new BEV launches.

• Profitability improvement anticipated through re-win orders and operational efficiency.

• Ongoing cost management and restructuring to address elevated COGS.