[Click eStock] "Medytox, Toxin Exports Plummet... Q1 Losses Continue"

[Asia Economy Reporter Minji Lee] Hana Financial Investment maintained a buy rating and a target price of 310,000 KRW for Medytox on the 13th, citing an expected operating loss in the first quarter.

Medytox is expected to record sales of 38.7 billion KRW in the first quarter, a 12.5% decrease compared to the previous year. The operating loss is estimated at 4.9 billion KRW, marking consecutive losses following the fourth quarter.

Minjung Seon, a researcher at Hana Financial Investment, explained, “Cosmeceuticals such as toxins and fillers are not essential consumer goods like pharmaceuticals, so their sales were directly hit by the pandemic.” She added, “Since January this year, as the COVID-19 virus spread in China, toxin export data compiled by the Korea Customs Service showed a 24% decrease in the first quarter compared to the previous year.” In particular, exports to China decreased by 47% year-on-year, which was the main cause of the decline in toxin exports.

Medytox recorded a loss of 4.6 billion KRW in the fourth quarter of last year due to approximately 16.3 billion KRW in ITC litigation costs. It is believed that about 10 billion KRW in ITC litigation costs reflected in the first quarter also contributed to the operating loss. Researcher Minjung Seon stated, “Once the preliminary ITC litigation ruling is announced on June 5, no further litigation costs will occur,” and added, “Since the stock price has been significantly adjusted due to the ITC litigation, performance improvement is expected from the second quarter onward.”

The improvement in consumer sentiment in China is positive for the stock price. Researcher Minjung Seon said, “China declared victory over COVID-19 on the 10th of last month, and consumer sentiment is recovering,” adding, “China’s Purchasing Managers’ Index (PMI) for March was 52, a significant increase from 35.7 in February.”

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