Kolon Industries Q2 Operating Profit 65.8 Billion KRW...25.8% Decrease YoY

"Film and Electronic Materials Deficit Widens"

Kolon Industries announced on the 7th that it recorded consolidated sales of 1.3472 trillion KRW and an operating profit of 65.8 billion KRW in the second quarter of this year. These figures represent decreases of 3% and 25.8%, respectively, compared to the previous year.

Kolon Industries cited the expansion of losses in the film and electronic materials division, demand contraction due to the global economic crisis, and ongoing financial market uncertainties as factors behind the slowdown in performance compared to the previous year.

However, compared to the previous quarter, sales and operating profit increased by 9.6% and 127.8%, respectively. This was driven by improved performance in the industrial materials division due to increased new car sales, recovery of profitability in the chemical division due to a decline in raw material prices, and the effect of entering the semi-peak season in the fashion division.

Looking at each business segment, the industrial materials division saw sales growth led by the strong performance of its subsidiary Kolon Glotech’s car seat business, supported by the resolution of the vehicle semiconductor supply shortage and the recovery of new car demand. Aramid continued its growth trend, contributing to segment sales growth, as it prepares to complete the Double-Up expansion of its Gumi plant in the second half of this year amid increased demand for electric vehicles and 5G communications.

Exterior view of the Win-Win Hub, a win-win type complex facility within Kolon Industries Gimcheon Plant 1 [Photo by Kolon Industries]

The chemical division performed relatively well despite adverse market conditions, supported by a decline in petroleum resin raw material prices and increased demand for phenolic resin due to the shipbuilding industry boom cycle. The film and electronic materials division continued to incur losses due to weak demand in the IT upstream industry and rising raw material prices, but reduced the loss margin compared to the previous quarter by adjusting production operating rates.

The fashion division maintained its sales growth trend through a proactive portfolio composition responding to diversified trends and weather changes. The golf wear brand supported segment sales with differentiated product competitiveness despite the base effect of COVID-19 last year.

A Kolon Industries official stated, "The management environment is expected to remain challenging in the second half of this year due to the prolonged complex crisis," adding, "In the third quarter, we will strive to achieve continuous growth in each business segment based on stable growth in the industrial materials division."

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