PI Advanced Materials (178920) Q3 2024 earnings summary

Executive summary

• Achieved highest quarterly sales for graphite sheet film since 2021, with total sales of KRW 70.7bn in 3Q24, up 15.1% year-over-year but down 4.2% sequentially from 2Q24.

• EBITDA rose 73.7% year-over-year to KRW 20.4bn, with margin improving to 28.9%.

• Net profit increased 53.2% year-over-year to KRW 6.4bn, though down 52.2% from the previous quarter.

• Maintains global PI film market leadership since 2014, with a diverse product portfolio and strong R&D focus.

• Major ownership change in December 2023, with Arkema Korea Holdings acquiring a 54.07% stake.

Financial highlights

• Sales for 3Q24 reached KRW 70.7bn, with cumulative 2024 sales at KRW 196.2bn, up 19.4% year-over-year.

• Operating profit was KRW 12.1bn, up 184.6% year-over-year, with margin at 17.1%.

• Net income for 2024 Q3: ₩21.4B, compared to a net loss of ₩1.8B in 2023 and net income of ₩45.7B in 2022.

• Cash and cash equivalents at Q3 2024: ₩74.4B, up from ₩56.4B at 2023 year-end.

• Gross profit margin rose to 26.9% in 3Q24 from 18.4% in 3Q23.

Outlook and guidance

• Anticipates seasonal off-peak in 4Q24 due to customer inventory adjustments.

• Expects demand from new smartphone launches and high-value-added products.

• Plans to expand global sales, especially in battery insulation and semiconductor films.

• Focus on expanding PI varnish production for EV applications, with new facility investment extended to 2028.

• Ongoing cost optimization and supply chain diversification to manage raw material price fluctuations.