[Click eStock] "i-SENS, Earnings Visibility Still High"

Korea Investment & Securities analyzed on the 5th that i-SENS still has high earnings visibility. No investment opinion or target price was provided.

i-SENS recorded sales of 70.3 billion KRW and operating profit of 3.8 billion KRW in the third quarter. Sales increased by 4.9% compared to the same period last year, and operating profit turned positive. Si-on Kang, a researcher at Korea Investment & Securities, said, "Sales fell short of market consensus by 7.8%, but operating profit exceeded it by 10.8%. BGM sales improved from the previous quarter, but CGM sales showed disappointing results." He added, "Operating profit partially reflected the effects of restructuring of subsidiaries that began in May."

He analyzed, "Regarding CGM, which is a key variable for i-SENS’s future performance and corporate value, it is still a time when a long-term approach is more valid than expecting quarterly performance improvement."

Researcher Kang evaluated, "Cumulative CGM sales until the third quarter amounted to 4.3 billion KRW, significantly below the original 2024 guidance of 15 billion KRW. The main cause is the underperformance of sales to Kakao Healthcare compared to early-year expectations."

However, he forecasted that earnings visibility remains high. He explained, "In July, ‘CareSense Air’ completed insurance registration in Hungary, and insurance registration is underway after product launches in Germany, the UK, the Netherlands, and Chile. Considering that insurance registration typically takes 3 to 6 months on average, sales in these regions are expected to accelerate starting next year."

He emphasized, "Next year, the recovery of the BGM business is expected to become visible based on sales expansion through new BGM partners and improved profitability of subsidiaries. Key momentum factors will include new global partner contracts for CGM, the introduction of selective correction functions in the first quarter of next year, and the launch of ‘CareSense Air’ in more than 20 new countries."