CXI to Pursue Capital Reduction and Stock Consolidation to Maintain Listing Status and Enhance Shareholder Value

KOSDAQ-listed company CXI is moving forward with a capital reduction and stock consolidation to proactively respond to strengthened listing maintenance requirements and to establish a foundation for enhancing shareholder value.

The company explained that this capital policy is not a measure taken due to a deterioration in its financial structure, but rather to secure a stable foundation for maintaining its listing status. In addition, in order to restore market confidence and demonstrate its commitment to remaining listed, the company’s executives are also actively considering increasing their equity stakes with personal funds. The capital reduction and stock consolidation are scheduled to be completed by the end of June, aiming to satisfy the new listing maintenance requirements that are set to take effect in July, ahead of schedule.

The capital reduction will involve adjusting the par value of common shares from $0.50 to $0.10, with a reduction ratio of 80%. The total number of shares issued will remain at 37,348,303. The company views this as more than a simple formal adjustment; it is a capital policy intended to lay the groundwork for future shareholder return policies, such as dividends.

The stock consolidation will then combine five common shares with a par value of $0.10 each into one common share with a par value of $0.50. As a result, the total number of shares issued is expected to decrease from the current 37,348,303 to approximately 7,469,660. The company expects this move to stabilize its share price and enhance corporate value by securing an appropriate number of shares in circulation.

This initiative has been undertaken in response to recent changes in KOSDAQ listing maintenance regulations. The Financial Services Commission will raise the minimum market capitalization for KOSDAQ delisting to KRW 20 billion starting July 1, 2026, and will also introduce new delisting criteria for penny stocks trading below KRW 1,000. Accordingly, the company has established countermeasures through its capital policy ahead of the implementation of these regulations.

CXI maintains that there has been a significant gap between its corporate value and financial condition due to prolonged undervaluation. In fact, according to the June fiscal year-end, the company recently posted sales of KRW 57.6 billion and a net profit of KRW 12.7 billion, with total assets of KRW 494.2 billion, total equity of KRW 491.6 billion, and total liabilities of KRW 2.5 billion, indicating low debt and strong profitability.

A company official stated, “This capital reduction and stock consolidation are capital policies designed to simultaneously establish a foundation for shareholder returns, stabilize share prices, and respond to listing maintenance requirements,” adding, “We will continue to implement necessary measures so that our solid financial base and business value are properly recognized by the market.”

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