SKIET Reports Operating Loss of 67.4 Billion KRW in Q1, Turning to Deficit

SK Innovation Energy Technology (SKIET) has turned to a deficit due to sluggishness in the upstream industry caused by the electric vehicle 'Chasm' (temporary demand stagnation) and other factors.

SKIET announced on the 29th that its operating loss for the first quarter of this year was 67.4 billion KRW, marking a turnaround from an operating profit of 1.7 billion KRW in the same period last year. Although it posted an operating profit of 26.9 billion KRW in the fourth quarter of last year, it returned to a loss within just one quarter. Sales dropped by 67.69% compared to the same period last year, amounting to 46.2 billion KRW. Net loss also turned to 60.3 billion KRW.

Sales of separators for electric vehicles (EV), which account for about 73% of sales, sharply declined due to inventory adjustments by major customers, and the company was also affected by increased non-operating losses caused by reduced operating rates.

However, SKIET expects gradual performance improvement in the second quarter, supported by the depletion of separator inventories by electric vehicle customers and the start of sales to new global customers.

An SKIET official said, "From the second quarter, sales volume is expected to increase as inventory adjustments by major electric vehicle customers are completed," adding, "In particular, separator sales to new customers in the North American region, secured through orders last year, are expected to begin."

On the same day, SKIET unveiled plans to strengthen cost competitiveness. The company aims to improve short-term profitability by reducing fixed costs related to factory operations and recycling raw materials, and plans to enhance financial soundness through the liquidation of non-core assets such as the currently idle Cheongju plant.

SKIET is also accelerating efforts to discover future business opportunities to strengthen the competitiveness of its separator business in the mid to long term. Utilizing its film, blending, and coating capabilities of separators, SKIET plans to secure solid electrolyte technology and explore business opportunities in carbon dioxide capture separator technology.

An SKIET official stated, "This year is a period of unprecedented uncertainty in the upstream industry, making it necessary to strengthen the fundamental competitiveness of the separator business," adding, "We will establish a sustainable growth foundation based on a global production system across Korea, China, and Poland plants and product competitiveness capable of responding to various physical properties to meet the complex demands of customers."