Posco Future M (003670) Q1 2025 earnings summary

Executive summary

• Total sales reached KRW 845.4 bn in 1Q25, up sequentially but down year-over-year, with operating profit at KRW 17.2 bn and net profit at KRW 49.1 bn, rebounding from prior losses.

• Energy materials accounted for 59.8% of sales, with major customers including POSCO, Ultium Cells, Samsung SDI, and LG Energy Solution.

• Maintained strong market position as the only domestic supplier of both cathode and anode battery materials, with ongoing capacity expansions in Korea, China, and North America.

Financial highlights

• Gross profit improved to KRW 75 bn from KRW 17 bn in 4Q24, with gross margin at 8.8% in Q1 2025.

• EBITDA rose to KRW 97 bn, up KRW 86 bn sequentially and KRW 20 bn year-over-year.

• Cash and cash equivalents decreased to KRW 444.8 bn at quarter-end, down from KRW 644.2 bn at year-end 2024.

• Interest-bearing debt increased to KRW 3,654 bn, with total borrowings and bonds outstanding including KRW 2.01T hybrid and KRW 2.01T bonds.

• Total assets stood at KRW 8.13 trillion, with a debt ratio of 139%.

Outlook and guidance

• Continued investment in battery materials capacity, with KRW 472.8 bn invested in Q1 2025 for new and expanded facilities.

• Management expects ongoing growth in EV and ESS markets, but notes potential headwinds from global EV demand slowdown and U.S. tariffs on battery materials.

• No dividend planned for FY2024 due to prior year losses and ongoing capital expenditures; dividend resumption will be considered as conditions improve.