Hanon Systems (A018880) Q1 2026 earnings summary

Executive summary

• Revenue for 1Q 2026 reached KRW 2,748.2 billion, up 1.7% sequentially from 4Q 2025, driven by cost efficiencies and favorable FX impact.

• Operating profit increased 8.3% quarter-over-quarter, with margin improving to 3.5% due to material, freight, and labor cost management.

• Revenue stability was supported by expanded supply coverage and strong growth with European customers.

• Electrified vehicle (xEV) revenue ratio rose to 29%, with further growth expected as market expansion continues.

Financial highlights

• Cost of goods sold (COGS) was KRW 2,460.3 billion, representing 89.5% of sales, reflecting improved cost structure and efficiencies.

• SG&A expenses were KRW 190.8 billion (6.9% of sales), with R&D spending at 3.4% of revenue and 34% of R&D capitalized.

• EBITDA for 1Q 2026 was KRW 283.9 billion, with a margin of 10.3%.

• Net capital expenditure and R&D spending optimization are expected to further improve cost structure in 2026.

Outlook and guidance

• 2026 new business wins target set at $1.3 billion, with key programs scheduled for upcoming quarters.

• Growth visibility secured through ICE/HEV program extensions and transition to higher EV mix.

• Capex and R&D spending optimization expected to support profitability improvements.