Hanil Vacuum, Confident to Escape Management Status After Merger Completion... "Temporary Designation Due to Pre-Merger Financial Statements"

Hanil Jinkong stated on the 13th, “The designation as a management item is based on the pre-merger financial statements, and with the merger registration completed on the 8th, we are confident that the reasons for the management item designation will be fully resolved this year.”

The company explained that the designation as a management item and investment caution item at this internal settlement point is temporary, based on the pre-merger financial statements. They added that the situation is completely different from other management items because the excellent new business performance from the merger with NewOn will be reflected starting this year.

A Hanil Jinkong official said, “As already known, due to the continuous sluggishness of existing businesses, the 2023 performance recorded operating losses for five consecutive business years and continuing business losses before corporate tax expenses exceeding 50% of equity capital in two out of three business years,” adding, “With the financial statements and performance of NewOn, merged in March this year, reflected, the reasons for the designation as a management item and investment caution item can be quickly resolved and overcome.”

He continued, “Our goal is not simply to escape the management item designation but to grow into a leading domestic lifestyle platform and expand into the global market.”

The company stated that as the performance slowdown continued due to the sharp decline in capital investment in upstream industries, they recognized this issue and have been seeking solutions. To address this, they pursued a merger with NewOn, a company specializing in the development of new materials for body fat reduction, and plan to reap the benefits this year and embark on a full-scale turnaround.

Jongjin Lee, CEO of NewOn, who led the healthcare division at Dongkook Pharmaceutical, stated in a recent interview that 2024 will be the first year NewOn transforms into the strongest lifestyle platform in Korea. CEO Lee is smoothly progressing not only in developing new materials specialized in body fat reduction but also in M&A with excellent companies to secure new growth engines. He said they are preparing to achieve sales of 300 billion KRW and operating profit of over 45 billion KRW by 2028.