[Click eStock] "Jcontentree, Q4 Earnings Shock Last Year... This Year Will Be Different"

Yuanta Securities Issues 'Buy' Investment Rating and Sets Target Price at 49,000 Won... Closing Price on the 11th at 40,400 Won

[Asia Economy Reporter Kum Boryeong] Although Jay Contentree's fourth-quarter performance last year showed an earnings shock, analysis suggests that this year will be different.

According to Yuanta Securities on the 12th, Jay Contentree's operating loss in the fourth quarter of last year was 6.6 billion KRW, and sales were 155.1 billion KRW. Operating profit turned negative, but sales grew 16% compared to the previous year. By segment, broadcasting recorded an operating loss of 10.1 billion KRW, while film posted an operating profit of 6.8 billion KRW.

In broadcasting, sales increased by 28% year-on-year to 68.6 billion KRW. The core profit indicator, distribution sales, surged 64% to 43.6 billion KRW, setting a new record high. This was due to overseas sales, which had maintained around 10 billion KRW per quarter, skyrocketing to 24.4 billion KRW thanks to pre-sales to Netflix.

Researcher Park Seongho of Yuanta Securities explained, "Excluding one-time costs, the gross profit in the fourth quarter of last year was 12.2 billion KRW, slightly lower compared to the 13 billion KRW range in the first and third quarters. For reference, Jay Contentree's headquarters' remaining copyright balance was 13.2 billion KRW as of the third quarter, but due to accelerated amortization of copyrights in the fourth quarter, the remaining balance significantly decreased. Therefore, this year's broadcasting performance is likely to exceed investors' existing expectations."

The film performance improved as Megabox's directly operated theaters attracted 6.48 million viewers, a 2% increase from the previous year. Advertising revenue also achieved growth in the 20% range for three consecutive quarters.

Researcher Park's analysis is that both quantity and quality will improve this year. He said, "JTBC plans to establish a new Wednesday-Thursday drama slot in the first half of this year, led by 'Ssanggap Pocha.' The number of dramas is estimated to increase from 13 last year to 18 this year. Jay Contentree will supply 'All of Us Are Dead' as its first Netflix original in the first half of this year. Since the production budget for the first original work is invested at the level of a major drama, profits related to Netflix originals are expected to be considerable."

Yuanta Securities gave Jay Contentree a 'Buy' investment rating with a target price of 49,000 KRW. The closing price on the 11th was 40,400 KRW.

This content was produced with the assistance of AI translation services.