GemVax Removed from Investment Warning List: "We Will Continue Strong Performance This Year"

[Asia Economy Reporter Hyunseok Yoo] GemVax & Kael (hereinafter GemVax) has been removed from the investment caution list. GemVax announced on the 24th that it submitted an audit report with an 'unqualified' opinion on the 2020 financial statements to the Korea Exchange and was delisted from the investment caution list.

After being designated as an investment caution stock last year due to accounting treatment issues with an external auditor, GemVax strengthened its accounting-related systems and improved internal processes to resolve the reasons for the caution designation.

Along with this, the company recorded sales of 65.7 billion KRW, operating profit of 1.4 billion KRW, and net profit of 1.6 billion KRW last year. The increase in demand for the non-face-to-face economy due to the COVID-19 pandemic led to the company's strong performance. Additionally, as semiconductor industry-related facility investments increased, the demand for semiconductor filters produced by GemVax also rose.

The company also explained that clinical trials for its major pipelines are progressing as planned. The development of an Alzheimer's disease treatment aims to receive IND approval for domestic Phase 3 clinical trials within the year and to commence full-scale clinical trials. Global clinical trials in the US and Europe are also ongoing with close local consultations. The development of a benign prostatic hyperplasia treatment is expected to complete domestic Phase 3 clinical trials in the second half of this year and announce results in the first half of next year, according to the company.

Furthermore, strong performances from GemVax’s affiliated listed companies are also expected to continue. Major affiliates include GemVax Link, GemVax Geo, Chris F&C, and Samsung Pharm. Among these, GemVax Link, GemVax Geo, and Chris F&C recorded profits.

GemVax Link, which operates luxury parallel imports and software development businesses, recorded sales of 93.4 billion KRW last year, with operating profit of 3.7 billion KRW and net profit of 9.7 billion KRW during the same period.

GemVax Geo, a comprehensive interior and renewable energy company, succeeded in turning a profit with an operating profit of 600 million KRW due to increased interior demand influenced by COVID-19. The company plans to continue improving performance through restructuring its business division’s profit and loss structure.

Chris F&C, a golf wear specialist company, enjoyed a COVID-19 boom and achieved record-high operating profit of 49.8 billion KRW, a 32.1% increase compared to the previous year.

Samsung Pharm completed the conversion of all but about 1.5 billion KRW of the 31st series convertible bonds issued in February last year, resulting in a sound financial structure with no bank debts or borrowings other than the remaining convertible bonds. Samsung Pharm declared a transformation towards a 'new drug-centered' structure this year and plans to focus on research and high value-added product manufacturing centered on new drug development in close collaboration with GemVax.

A GemVax official stated, “Following strong performances not only by GemVax but also across its affiliates last year, the total cash and cash equivalents held by all affiliates amount to about 200 billion KRW, ensuring financial soundness and enabling more stable business operations this year.” He added, “With the global economic recovery in the post-COVID-19 era, the performance outlook for GemVax and all its affiliates this year is expected to be bright.” He emphasized, “GemVax will continue efforts to enhance corporate value based on improved accounting transparency and concentrate all capabilities on the bio sector, the identity of the GemVax Group, to achieve research outcomes through domestic and international clinical trials.”