"Biol, Strong U.S. Export Performance Drives Earnings"

[Asia Economy Reporter Jang Hyowon] IBK Investment & Securities analyzed on the 27th that Biol's strong exports to the United States drove its performance. It is expected that performance growth will continue next year following the fourth quarter of this year.

Biol was listed on the KOSDAQ market last November through a merger with IBKS No.11 SPAC. It manufactures and sells aesthetic medical devices ‘Scarlet’ and ‘Silfirm’, and last year launched the skin care device ‘SilfirmX’, which combines the functions of the two products into one.

As of the end of the third quarter this year, the cumulative sales composition ratio is 17% for Scarlet, 41% for SilfirmX, 28% for consumables, and 14% for products and others. The export ratio is 80%, and the sales composition ratio by region is 32% North America, 17% Asia, 15% Europe, 14% Middle East, and 2% others. The remaining 20% is domestic sales.

As of the end of the third quarter, sales amounted to 4.6 billion KRW, a 151% increase compared to the same period last year, and operating profit turned positive to 1.6 billion KRW. Due to strong exports, sales volume has grown since the second quarter, and operating profit margin rose to 34.9% due to the operating leverage effect.

Although domestic demand has been sluggish recently, the new product ‘SilfirmX’ has been exported in earnest since the second quarter, causing the sales ratio in the North American region to surge from 20% last year to 32%. Also, the increase in the proportion of high-profit consumables from 16% last year to 30% is another factor contributing to the rise in profit margin.

Minhee Lee, a researcher at IBK Investment & Securities, said, “Sales in the fourth quarter of this year are expected to increase further, and annual sales for this year are expected to grow 42% compared to last year,” adding, “Next year’s sales are also expected to increase by 30% due to the expansion of export regions.”

The researcher added, “Although marketing expenses are expected to increase next year compared to this year, operating profit margin is estimated to improve further to 33.8% from 31.8% this year, supported by economies of scale and further expansion of the consumables ratio.”