[Asia Economy Reporter Hyunseok Yoo] Aton has succeeded in reversing its performance. The expansion of new clients in the financial sector has significantly increased sales of security solutions. The company is expected to strengthen its sales by exploring business expansion into areas such as NFT (Non-Fungible Token) security in the future.
Aton is a security software development company established in 1999. It supplies security solutions for financial apps mainly to commercial banks such as KB Star Banking and NH Smart Banking. It is also the certificate service provider for the private electronic authentication service (PASS) of the three major telecom companies. Currently, it operates the LG Uplus PASS app.
The company entered the KOSDAQ market in 2019. At the time of listing, the expected public offering price range was 30,000 to 43,000 KRW. The final public offering price was set at the top end of 43,000 KRW, raising 38.6 billion KRW. At the time of listing, it announced plans to use 14.4 billion KRW for research and development (R&D), 7.2 billion KRW for investment and acquisition funds, 6.5 billion KRW for marketing and advertising, and 2.7 billion KRW for facility investment. As of the first half of this year, it utilized 2.7 billion KRW for R&D, 7.2 billion KRW for investment and acquisition, and 7.3 billion KRW for marketing and advertising, totaling 13.6 billion KRW. The company explained that the unspent amounts will be prioritized and executed by next year.
Performance faltered last year. Consolidated sales, which were 28 billion KRW in 2018, increased to 32.5 billion KRW in 2019 but decreased to 29 billion KRW last year. However, it succeeded in reversing its performance this year. As of the first half of this year, it achieved sales of 21.2 billion KRW and operating profit of 4.7 billion KRW, representing increases of 42.70% and 203.84% respectively compared to the same period last year.
In Aton’s core business segment, fintech security solutions, new clients have expanded mainly in the financial sector. Sales growth driven by existing clients’ purchases of mobile OTP licenses led the performance improvement. The sales of the fintech security solutions segment reached 10.3 billion KRW in the first half of this year, achieving 79% of last year’s sales (13.1 billion KRW).
Performance improvement is also expected in the second half of this year. NH Investment & Securities forecasted in a corporate analysis report last month that Aton’s sales and operating profit this year will reach 43.5 billion KRW and 9.5 billion KRW, increasing by 49.9% and 360.2% respectively compared to the same period last year.
The company expects to benefit from the increase in solution sales due to the mobile transformation of the financial sector, as well as from the MyData business to be implemented next year. An Aton official said, "As the financial sector transitions to digital, demand for authentication and security is increasing," adding, "The MyData business is scheduled to be fully implemented next year, and authentication certificates are required to conduct this business, for which we have certificate construction solutions."
Additionally, the company plans to proceed with NFT-related security business through a recent new joint venture. An Aton official said, "We are considering security and authentication services for virtual assets related to NFTs and artworks," explaining, "This area has not yet been regulated officially."
In September, Aton made a strategic investment in the joint venture 'Cardo' along with NH Nonghyup Bank, Hexlant, Galaxia Moneytree, and Korea Information & Communications to enter the digital asset market. Cardo is a custody company that provides highly reliable infrastructure for customers holding digital assets.
The service scope of the joint venture Cardo includes not only coins but also various tokenizable assets such as real estate and artworks. It plans to connect to new blockchain-based financial services targeting the MZ generation, including gaming and entertainment.
However, the company explained that this is still at the conceptual stage. An Aton official stated, "Since the JV was established recently and is not yet fully operational, this is just one of several concepts under consideration."
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