SKC (011790) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue rose 13.8% sequentially to KRW 472.7bn, with operating loss narrowing to KRW -62.7bn from KRW -76.2bn in Q1.

• Net loss deepened to KRW -115.3bn, with profit attributable to the parent at KRW -116.3bn.

• The company operates as a holding company with core businesses in secondary battery materials, chemicals, and semiconductor materials.

• Major restructuring included divestment of non-core businesses, expansion in battery and semiconductor segments, and global capacity investments.

• The group includes multiple subsidiaries, with recent M&A activity and divestitures to focus on high-growth, ESG-aligned sectors.

Financial highlights

• Consolidated H1 2024 revenue: KRW 887.9bn, down from KRW 1.57T in H1 2023 and KRW 2.39T in H1 2022.

• Operating loss: KRW -138.9bn (H1 2024), compared to KRW -216.3bn (H1 2023).

• Gross profit returned to positive at KRW 6.7bn after a loss in Q1.

• Recognized a one-off impairment loss of KRW 33bn on financial assets in Q2.

• Cash and equivalents at period end: KRW 560.5bn.

Outlook and guidance

• Management targets mid- to long-term revenue growth to KRW 7.9T by 2025 and KRW 11.4T by 2027, driven by battery and semiconductor materials.

• Prolonged demand slowdown expected in the global EV value chain, but sequential production increases in Malaysia anticipated to support earnings recovery.

• Semiconductor materials expected to maintain momentum, aiming for global leadership in test sockets.

• New business initiatives include commercialization of glass substrates by 2025 and expansion of eco-friendly materials.

• Focus on high-value, ESG-friendly products and cost competitiveness.