W-Scope Chungju Plant (393890) Q2 2024 earnings summary

Executive summary

• Revenue for 2Q24 reached KRW 116.6 billion, up 40.6 billion year-over-year but down 5.8 billion sequentially from 1Q24.

• Net profit for 2Q24 was KRW 3.4 billion, a decrease of 9.7 billion year-over-year but a slight increase of 0.1 billion sequentially.

• Manufactures and sells separators for lithium-ion batteries, focusing on wet and ceramic-coated separators for EVs and ESS applications.

• Expanded production capacity with new lines in Korea and Hungary, targeting global EV market growth.

• Listed on KOSDAQ since 2022, with stable ownership and no major changes in capital structure.

Financial highlights

• H1 2024 revenue: ₩239.0B, down from ₩305.0B in FY2023 and ₩257.5B in FY2022.

• Operating profit for 2Q24 was KRW 1.8 billion (1.5% margin), up from KRW 0.6 billion in 1Q24 but down from KRW 16.7 billion in 2Q23.

• EBITDA for 2Q24 was KRW 17.0 billion (14.6% margin), up from KRW 15.1 billion in 1Q24 but down from KRW 28.0 billion in 2Q23.

• H1 2024 net income: ₩6.8B, compared to ₩53.6B in FY2023 and ₩55.3B in FY2022.

• CAPEX in 2Q24 was KRW 75.4 billion, a significant decrease from KRW 147.4 billion in 1Q24 and KRW 144.2 billion in 2Q23.

Outlook and guidance

• Prismatic battery shipments expected to remain flexible to support main customer demand in 2H24.

• Global EV separator demand expected to grow at 19% CAGR through 2030, with North America leading growth.

• Company expanding capacity in Hungary and planning North American site selection in H2 2024.

• Focus on cost reduction and technology leadership to maintain competitiveness amid EV market volatility.

• Recovery in non-EV power tool demand likely postponed; logistics costs remain pressured by geopolitical risks.