Daekyo Faces Poor Performance, Focuses on Senior Business

Daekyo Newif to Acquire 9 Long-term Care Centers
Senior Business Sales Expected to Grow to 30 Billion KRW Next Year

Daekyo, famous for the children's learning program 'Noonnoppi,' is accelerating the expansion of its senior business. The company is focusing on the senior business to overcome poor performance caused by the stagnation of its education business.

On the 25th, Daekyo Newif secured operating funds of 14 billion KRW through its parent company, Daekyo. This money will be used for the acquisition of nine long-term care centers in the metropolitan area, which Daekyo Newif is currently pursuing, and for the expansion of its senior business.

Daekyo Newif plays a leading role in Daekyo's senior business. In 2022, Daekyo formed the Newif Business Team under its Growth Business Division and then spun off this team into a subsidiary last June. Kang Ho-jun, the second-generation owner of the Daekyo Group and CEO, has actively participated in the Daekyo Newif board of directors, showing a strong commitment to expanding the senior business.

Although Daekyo Newif has been launched for less than two years, it is producing visible results. Last year, Daekyo Newif's sales were only 4.6 billion KRW. However, the company is expected to more than double its sales compared to the previous year by achieving 5.2 billion KRW in sales in the first half of this year alone.

In particular, Daekyo expects that if the acquisition of Daekyo Newif's long-term care centers proceeds smoothly, it will secure an annual sales base of more than 20 billion KRW in the long-term care business starting in 2025. In this case, senior business sales will increase to 30 billion KRW next year.

Senior Cognitive Function Enhancement Program 'Daekyo Brain Training' Campaign Video. (Photo by Daekyo)

Daekyo Newif operates visiting services where professional instructors visit elderly customers, as well as Daekyo Newif Center services, which are private long-term care insurance daycare welfare facilities. The current goal is to increase the number of Daekyo Newif Centers from 48 to 100 within this year. As of March, the number of users was 905.

Additionally, Daekyo expects the overall growth of the senior business to accelerate through the nationwide expansion of the senior cognitive enhancement program 'Brain Training' and the channel expansion of the senior cultural information channel 'Daekyo Newif Plus,' along with the activation of related businesses.

The reason Daekyo is focusing on the senior business is that its core education business is experiencing a long-term slump due to a decline in the school-age population. Daekyo has recorded operating losses for four consecutive years since 2020, when COVID-19 spread. It recorded an operating loss of 7 billion KRW in the first half of this year as well.

Efforts to improve education business performance continue. Daekyo participated in the elementary school certified textbook business by submitting elementary math textbooks in 2021 but withdrew from the textbook business this year to improve cost efficiency. Meanwhile, it plans to escape this year's deficit by raising offline learning center fees by 10% starting in the second half of the year.

A Daekyo official explained, "We plan to introduce various learning management support services in line with changing education trends and the launch of AI digital textbooks," adding, "With a two-track strategy involving Daekyo and Daekyo Newif, we will continue to strengthen the senior business."