Kwangmoo Turns to 18.8 Billion Won Net Profit in Q1... Significant Improvement in Financial Soundness

Kwangmoo, a KOSDAQ-listed company, achieved a turnaround in net profit in the first quarter of this year, signaling a rebound in performance. The improvement in profitability is attributed to increased financial income, cost reduction, and the streamlining of its business structure.

On May 15, Kwangmoo announced that its consolidated net profit for the first quarter of this year reached 18.8 billion won. This marks an improvement of approximately 59.4 billion won from a net loss of 40.6 billion won during the same period last year, returning the company to profitability.

During the same period, revenue was 1.2 billion won, representing a decrease of 19.02% compared to the first quarter of the previous year. However, operating loss was recorded at 900 million won, a reduction of 19.61% from the same period last year, and profit before income tax was 24.1 billion won.

The company cited the expansion of financial income and company-wide management efficiency efforts as the main drivers of performance improvement. Kwangmoo has focused on restructuring inefficient business operations and reducing selling and administrative expenses, with selling and administrative expenses for the first quarter of this year amounting to 1 billion won, more than 400 million won less than the same period last year.

In particular, financial income had a significant impact on improving net profit. Kwangmoo's financial income for the first quarter of this year was calculated at 24.7 billion won. The company explained that the improvement in performance reflected the increased valuation of its investment stocks during the diversification of its financial portfolio in response to heightened volatility in the global market.

The company further noted that, having achieved a turnaround in net profit despite relatively low stock prices at the end of the first quarter, there is potential for additional valuation gains in the second quarter if the value of its financial assets continues to rise.

Financial stability indicators also showed clear improvement. The debt ratio for the first quarter of this year was 8.07%, down 14.36 percentage points from 22.43% in the same period last year. The debt ratio, which was 11.28% at the end of the second quarter last year, fell to 9.21% at the end of the third quarter, entering the single-digit range and maintaining a stable trend since then.

Reliance on borrowings continued to decline as well. In the first quarter of this year, the company's borrowing dependence was 0.53%. This figure has steadily decreased from 8.63% in the first quarter of 2025, 6.03% in the second quarter, and 4.44% in the third quarter. In the fourth quarter of last year, it dropped to 0.44%, effectively establishing a virtually debt-free financial structure.

Liquidity was also significantly strengthened. Kwangmoo's current ratio rose from 130.80% at the end of 2020 to 1,666.75% at the end of last year, and further increased to 2,544.07% in the first quarter of this year. For the first time since its founding, the company surpassed a current ratio of 2,000%. Generally, a current ratio of over 200% is considered indicative of excellent financial liquidity.

As of the end of the first quarter of this year, cash and cash equivalents, including deposits at financial institutions and other financial assets, amounted to 160.6 billion won. The company explained that actual liquidity is even higher when taking into account other assets that can be readily converted into cash.

A Kwangmoo representative stated, "The virtuous cycle established through strategic capital reinvestment is translating into tangible financial performance. Based on a stable growth foundation and ongoing efforts to improve profitability, we will continue to expand consolidated net profit."

The representative added, "As of the first quarter of this year, total equity stands at 230 billion won, and book value per share (BPS) is at 3,851 won. Considering that the recent stock price has been in the low 2,000 won range, there is potential for a revaluation of the company's value going forward."

Industry observers note that these results demonstrate Kwangmoo's entry into a full-fledged phase of structural improvement, driven by expanded financial income, cost efficiency, and enhanced financial stability.

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