Battery material specialist company Gwangmu announced on the 15th that its sales for the first quarter of this year reached 5.343 billion KRW, and net profit was 618 million KRW, representing increases of 71% and 160% respectively compared to the same period last year. This is explained as a result of focusing on profitability-centered sales growth and risk management.
However, operating loss was 1.146 billion KRW, down 57% from the previous year. This was due to an increase in one-time expenses. One-time selling and administrative expenses increased due to capital expenditures (CAPEX) at the Ochang and Jecheon plants, payment fees (exchange investigation response and legal costs), and foreign exchange losses from foreign currency payments recovered from Enchem USA and Enchem Poland, which affected the performance.
Excluding temporary factors, Gwangmu's financial soundness has greatly improved. According to Gwangmu's summarized financial status for the first quarter, total liabilities were 23.971 billion KRW, total equity was 90.896 billion KRW, resulting in a debt ratio of 26%. Generally, a debt ratio below 200% is considered appropriate.
Looking at each business division, the secondary battery division led sales growth with a performance of 3.789 billion KRW in the first quarter. The NI·SI (Network Integration·System Integration) division also showed steady growth with newly added rental income of 106 million KRW from KT (Korea Telecom) equipment.
Despite the first quarter being a seasonal off-season and weak demand in the automotive electronics sector, orders for lithium salt (LiPF6) increased. In February, Gwangmu signed a lithium salt supply contract worth 3.677 billion KRW with Enchem.
Gwangmu plans to enter the secondary battery material production business this year to secure new growth engines. In the distribution sector, it aims to generate stable profits in the global market, and in the production sector, it plans to build a strong portfolio through high-margin basic materials.
A Gwangmu official stated, “The first quarter was a transitional period with costs incurred due to last year's structural improvements,” and added, “From the second quarter, we expect to recover quantitative and qualitative growth through business efficiency initiatives.”
The official also said, “We will actively promote globalization in collaboration with the K-battery value chain and continue to strengthen our competitiveness.”
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