[Asia Economy Reporter Hyungsoo Park] L&K Biomed announced on the 24th that it recorded sales of 3.6 billion KRW and an operating loss of 500 million KRW in the fourth quarter of last year on a consolidated basis.
On a consolidated financial statement basis, L&K Biomed tentatively reported sales of 18.5 billion KRW, an operating loss of 2.58 billion KRW, and a net loss of 6.89 billion KRW for last year.
On a separate basis, it recorded an operating profit of 4.16 billion KRW and a net profit of 7.15 billion KRW last year. Compared to the previous year, these increased by 170.8% and 178.1%, respectively. The company escaped losses for the first time in four years and was removed from the list of companies under management concerns.
A company official explained, "Considering the large operating losses sustained over the past three years, the scale of losses has been reduced," and added, "The trend of performance improvement will continue."
L&K Biomed changed its domestic business, which had a low-margin structure, to a dealership model to improve performance. By increasing sales centered on the United States, profitability was enhanced. The sales structure was strategically shifted from nearly half of the product mix to high-margin proprietary products. The cost of sales decreased.
By actively exporting innovative products and selling sterilized products in the U.S. market, profitability improved despite a decrease in sales volume.
In September 2019, L&K Biomed received U.S. FDA approval for three types of expandable cages. Since last year, the company has made a full-scale entry into the U.S. market with new products as the core axis. Although sales activities in the U.S. were restrained due to the impact of COVID-19, the strong performance of expandable cages reduced the scale of losses.
L&K Biomed is improving the proportion of cost of sales and selling and administrative expenses through active management improvement and strategic focus. The company plans to accelerate U.S. and overseas sales, including contracts with major distributors.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
