SK IE Technology (361610) Q2 2026 earnings summary

Executive summary

• Q2 2026 revenue rose to KRW 29,157.2 billion, up KRW 4,866.2 billion quarter-over-quarter, driven by strong performance in refining and lubricants.

• Operating profit increased by KRW 1,325.1 billion to KRW 3,487.3 billion, mainly from lubricants and battery businesses.

• Strategic restructuring included unwinding the BlueOval SK JV with Ford, consolidating production bases, and selling the Chinese subsidiary, resulting in cost savings and a focus on the European supply network.

• Net profit for 2Q26 was KRW 1,327.8 million, reflecting impairment losses and losses from the transfer of a subsidiary.

• SK Enmove leveraged its global Group III base oil leadership to address supply chain uncertainties and maintain stable operations.

Financial highlights

• Non-operating losses increased due to PRF derivative valuation losses (KRW 1.2 trillion) and SK IET impairment losses (KRW 1.4 trillion).

• FX-related losses were KRW 73 billion; net interest expenses KRW 261.9 billion; equity method gains KRW 37.2 billion.

• Total assets at Q2 end were KRW 102 trillion, down KRW 3.6 trillion from 2025 year-end.

• Debt-to-equity ratio increased to 152% in 2Q26; net debt rose by KRW 78 billion quarter-over-quarter.

• Gross profit for 2Q26 was KRW 30.1 billion, with a gross profit margin of 76%.

Outlook and guidance

• Crude prices and refining margins expected to remain volatile due to geopolitical risks and supply disruptions.

• Stable sales volumes expected in 2H26 amid limited market volatility, with positive momentum from tighter EU trade policies and environmental regulations.

• SK On anticipates further profitability improvements in H2 2026 from cost reductions and operational efficiency.

• Management expects continued short-term headwinds due to weak EV demand and delayed market recovery, but anticipates long-term growth from energy storage, robotics, and next-generation battery markets.