Polaris Sewon Increases Asset Value by 35.6 Billion KRW Through Asset Revaluation

[Asia Economy Reporter Jang Hyowon] Polaris Sewon, a specialized automotive air conditioning parts company, announced on the 2nd that its total assets increased by 35.6 billion KRW through asset revaluation, including its subsidiary Polaris Uno.

The asset revaluation targeted 14,359.5㎡ of land in the Sandan-ro area of Pyeongtaek City. The book value was recorded as 3.55 billion KRW as of the end of the third quarter last year. The purpose of the asset revaluation was to reflect the actual value of assets in accordance with K-IFRS (Korean International Financial Reporting Standards), improve financial structure through capital increase, and enhance shareholder value.

The asset revaluation was also conducted at the subsidiary Polaris Uno. The revaluation targets were 36,755.5㎡ of land in the Wanju Industrial Complex area of Bongdong-eup, Wanju-gun, Jeollabuk-do, and 139 Seokam-ro, Iksan City. The book value was 3.1 billion KRW as of the end of the third quarter last year, and the appraisal value was 7.2 billion KRW, an increase of 4.1 billion KRW.

Polaris Sewon’s consolidated land appraisal value increased from 6.65 billion KRW to 42.23 billion KRW through this asset revaluation. The increased asset value is expected to be reflected as 35.58 billion KRW in other comprehensive income revaluation surplus as of the end of last year.

A Polaris Sewon official stated, “This asset revaluation work aims to accurately assess the undervalued assets’ actual value to make more appropriate decisions in future management.” He added, “The revaluation results were reflected in last year’s financial statements, leading to increased capital and reduced debt ratio, thereby further improving the financial structure.”

He continued, “We expect these efforts, based on performance growth, to positively impact corporate value.”

Generally, asset revaluation is conducted when assets such as real estate show a significant difference between current value and book value due to factors like inflation. Through asset revaluation, the increased asset amount is recognized as an increase in capital under other comprehensive income, thereby increasing capital. The increased total capital lowers the debt ratio, improving borrowing conditions.

Meanwhile, Polaris Sewon holds an order backlog worth approximately 500 billion KRW for automotive parts, thanks to diversified sales channels for global automakers and expanded sales for electric vehicles. Based on this abundant order backlog, the company recorded solid performance, achieving the highest profit in the first half of the year. Polaris Uno is continuously increasing profitability due to expanded local production in Africa, strong sales of high value-added products, and the impact of a high exchange rate.