[Click eStock] "CNC International, Q3 Low... Expanding Overseas Proportion"

Hana Securities forecasted on the 25th that CNC International's performance, having bottomed out in the third quarter, will show signs of recovery starting from the fourth quarter of this year.

Park Eun-jung, a researcher at Hana Securities, stated in a report on the same day, “In the third quarter, the volume from domestic key clients shrank starting in August, and the launch schedule of large projects for overseas key clients was delayed, resulting in expected sales not being reflected. Additionally, the main formulations have been on the market for a long time in some brands, leading to a period of volume contraction. However, next-generation products have been developed in preparation for this, and the slowdown of existing main formulations combined with the timing mismatch of sales from new formulations contributed to the poor performance.”

He anticipated that the overseas proportion will expand in the fourth quarter. He analyzed, “The new project volumes from overseas key clients, which were delayed in the previous quarter, have started to be shipped, and as mass production systems for new formulations have been fully established, profitability is expected to improve compared to the previous quarter.”

Furthermore, he said, “The expectation for 2025 lies in next-generation formulations, with market responses to these products being favorable, leading to anticipated volume increases. Currently, deliveries are scheduled for overseas key clients, as well as other North American/Middle Eastern indie and global brands, and domestic export-focused clients. The volumes that contracted in the second half of the year are expected to gradually recover through reorderings and renewals.”

In addition, he explained, “The large sales volatility was mostly due to the short product life cycles centered on color cosmetics, but it also stems from having fewer client groups compared to relatively large ODM companies. We plan to focus on expanding and strengthening relationships with global indie and celebrity brands. Currently, development is underway with 3 to 4 brands, and some have already completed specific product developments. Tangible results are expected to gradually emerge.”