[Asia Economy Reporter Hyungsoo Park] T플랙스 is showing strong performance. The positive second-quarter earnings appear to have influenced the stock price.
As of 2:59 PM on the 10th, T플랙스 is trading at 4,130 KRW, up 2.1% from the previous day.
T플랙스 announced on the 10th that it recorded sales of 35.493 billion KRW and an operating profit of 1.294 billion KRW in the second quarter. Sales increased by 13.29% compared to the same period last year, while operating profit surged by 97.55%.
T플랙스 cited strong export performance as the reason for the excellent results. The company's export amount in the first half of this year was 4.975 billion KRW, up 21.5% from the same period last year. T플랙스 began exporting in 2017, recording export sales of 9.042 billion KRW in 2018 and 8.483 billion KRW in 2019. This year, it is expected to achieve the highest export performance ever.
Last month, T플랙스 also signed a supply contract with a Taiwanese company for 300 tons, the largest single export contract to date. Along with strong exports, steady increases in orders from domestic markets in front-end industries such as module materials for electric vehicle batteries and cryogenic valve materials for LNG ships have contributed to T플랙스's improved performance.
A T플랙스 representative said, “Despite the COVID-19 pandemic, customers are choosing T플랙스 products over Japanese or European products,” adding, “We are not just selling products but conducting technical sales linked to the quality, process, and applications of stainless steel, which has been well received by domestic and international clients.”
Along with increased sales, profit margins have also improved. T플랙스's operating profit margin in the second quarter was 3.6%, up from 2.1% in the same period last year and 3.2% in the previous quarter. The company analyzed that the improvement in profit margin was clear as depreciation expenses in the sheet metal business division decreased from about 600 million KRW last year to 300 million KRW this year.
With international nickel prices, which affect the unit price of T플랙스 products, continuously rising, the company expects the positive performance trend to continue in the second half of the year.
Kim Youngguk, CEO of T플랙스, said, “Despite the difficult situation caused by the recent COVID-19 pandemic, we are implementing an aggressive sales growth strategy to turn the crisis into an opportunity,” and added, “With the expansion of the electric vehicle market, sales in the company's wire rod business division are expected to continue increasing.”
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