SKC Reports 76.2 Billion KRW Loss in Q1... "A Period of Foreseen Growing Pains"

Sales of 415.2 Billion KRW... 13.4% Decrease Compared to Previous Year

SKC announced on the 3rd that it recorded sales of 415.2 billion KRW and an operating loss of 76.2 billion KRW in the first quarter of this year. Sales decreased by 13.4% compared to the same period last year, and the operating loss widened compared to the 28.9 billion KRW loss in the same period last year.

SKC explained, "Compared to the previous quarter, sales increased by about 60% despite the uncertain business environment and market conditions," and "the scale of the operating loss also improved by about 11%." SKC's sales in the fourth quarter of last year were 259.8 billion KRW, with an operating loss of 85.1 billion KRW.

The secondary battery materials business posted sales of 91.6 billion KRW and an operating loss of 39.9 billion KRW. Despite sluggish demand in the upstream market and a decline in copper prices, sales volume rebounded centered on major customers, expanding sales compared to the previous quarter. However, operating losses slightly increased during the same period due to increased fixed costs from the new factory in Malaysia. Based on ongoing major customer certifications and mid- to long-term supply contracts at the Malaysian plant, significant performance improvements are expected to begin in the second half of this year.

The semiconductor materials business achieved sales of 49.0 billion KRW and an operating profit of 7.9 billion KRW, showing growth compared to both the previous quarter and the same period last year. ISC, a test solution investment company acquired in October last year, led the performance improvement by increasing sales by 40% and operating profit by 244% quarter-on-quarter, mainly targeting non-memory customers such as artificial intelligence (AI) servers.

The chemical business recorded sales of 272.6 billion KRW and an operating loss of 15.3 billion KRW. Sales increased by 113% compared to the previous quarter as major production facilities, which were halted for regular maintenance last year, resumed operations. The scale of operating loss also improved by 46% due to expanded sales of the core product propylene glycol (PG), marking a full-fledged rebound.

Future growth engines in new businesses are also progressing smoothly. Absolix, a glass substrate investment company, recently completed equipment installation at the world’s first production plant built in Georgia, USA, and is currently conducting test runs. It plans to complete its own sample testing in the second quarter and begin full-scale customer certifications in the second half of this year.

SK Livio, an investment company in biodegradable materials, is constructing the world’s largest single plant with an annual production capacity of 70,000 tons of high-strength PBAT in Hai Phong City, Vietnam. The silicon anode material business completed a pilot production facility in the first quarter and is conducting product certification evaluations with major battery customers. Specific mass production investment plans will be decided based on the evaluation results.

An SKC official stated, "SKC is currently undergoing expected growing pains during a rapid transformation into a new business model," and added, "We will do our best to create a turning point for performance recovery, including a full-scale sales recovery across the business starting in the second half of the year."

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