W-Scope Chungju Plant (393890) Q1 2025 earnings summary

Executive summary

• Revenue in 1Q25 declined sharply to KRW 16.3bn, down from KRW 122.4bn in 1Q24 and KRW 17.5bn in 4Q24, reflecting a significant contraction year-over-year and sequentially.

• Operating profit turned negative at -KRW 48.4bn (-276.5%), compared to a small profit in 1Q24, indicating a substantial deterioration in profitability.

• Net profit also turned negative at -KRW 51.7bn, a steep drop from KRW 3.3bn in 1Q24, highlighting ongoing losses.

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

• Listed on KOSDAQ since 2022; operates globally with production in Korea and expansion in Hungary.

Financial highlights

• Q1 2025 consolidated revenue: KRW 16.3 billion, down sharply from KRW 322.1 billion in FY2024.

• Operating loss for Q1 2025: KRW -30.4 billion; net loss: KRW -33.4 billion.

• Gross profit margin fell to -251.4% in 1Q25 from 4.0% in 1Q24, indicating severe margin pressure.

• EBITDA dropped to -KRW 33.8bn (-193.1%) in 1Q25 from KRW 15.1bn (12.3%) in 1Q24.

• Cash and cash equivalents at Q1 2025: KRW 22.7 billion, down from KRW 59.7 billion at FY2024 end.

Outlook and guidance

• 2Q25 revenue expected to increase due to higher US shipments for a main customer.

• Global EV battery separator demand expected to grow at double-digit rates through 2030.

• Company expects continued supply requests from major cell and auto makers, with mid- to long-term sustainable growth anticipated.

• Hungary plant to begin trial operations in 2026, supporting European market expansion.

• From 2026, plans to diversify customer base and achieve rapid global growth, targeting double-digit operating margins after 2028.