SKC

l KCFT has an operating profit of 62.8 billion won, a 67% increase from the previous year, and it will be included in the SKC performance starting in the 1st quarter

l This year’s operating profit is expected to increase between 67-87% from the previous year thanks to the new growth engine and the recovery of existing businesses

SKC (President/CEO: Lee Wan-jae) reported the sales of 2.5398 trillion won and the operating profit of 155.1 billion won for 2019. The figure is decent when considering the global economic slump. The Industrial Material Business Division, in particular, recorded profit for four quarters in a row. The performance is expected to improve even more in 2020 as the results of deep changes are realized,  which will include the acquisition of KCFT.

On February 6, SKC announced its business performance for 2019 at KB Securities in Yeouido. Present at the announcement included the division heads such as Lee Yong-sun of the Industrial Materials Business Division, Oh Jun-rok of the Semiconductor Materials Business Division, and Pi Seong-hyeon of the Business Support Division as well as Kim Yeong-tae, CEO of KCFT which SKC acquired in January, Lee Jae-hong, COO of KCFT, and Weon Gi-don, CEO of the spun-off chemical unit.

The Industry Material Business Division reported the sales of 1.215 trillion won and the operating profit of 33.8 billion won, while also showing profit for four quarters in a row. The positive performance is the result of stabilized raw material prices, expansion of specialty products such as eco-labels and PLA films, and the improved performance of globally consolidated subsidiaries. SKC plans to increase the operating profit further in 2020 by expanding eco-friendly and mobile specialty products and integrated marketing with its affiliate SKC Hi-tech & Marketing.

The Growth Business Division reported the sales of 747.7 billion won and the operating profit of 15.8 billion won due to the slowing upstream industry and delayed investment. SKC expects the performance to improve with the increasing sales of CMP pad and others starting in the second quarter. The beauty/healthcare materials business has entered their peak season for the cosmetic materials, and the communications equipment business is undergoing an off-season but is expected to benefit from 5G investment.

The Chemical Business Division, which was spun off as a joint venture in the first quarter, recorded the sales of 770.6 billion won and the operating profit of 105.5 billion won. Although the performance is somewhat lower than the previous year due to the global economic slump and increased cost, SKC plans to strengthen the business competitiveness by continuing to launch more value-added products. External factors such as regular maintenance by the main competitor and stabilizing raw material prices are also likely to have a positive impact on performance improvement.

KCFT, which SKC acquired in January this year, reported 28% higher sales and 67% higher operating profit of 323.4 billion won and 62.8 billion won, respectively. The sales increase is mainly attributed to the increased demands for thin membranes by major customers. SKC plans to increase its profitability by increasing the operation of fourth factory to full capacity and investing in additional expansion in 2020. FCCL reported improved profitability, helped by increased demands and a more favorable exchange rate. It plans to increase its profitability by operating the expanded facilities and signing a long-term supply contract in 2020.

“Reflecting the results of acquired KCFT beginning in the first quarter, the operating profit in 2020 will be 260.0 to 290.0 billion won, which will be from 67 to 87% increase year-to-year. The year 2020 will be an important year to show the result of our effort for deep changes centered on mobility, semiconductor, eco-friendliness, and display,” an SKC official said.

The dividend is the same as the previous year at 1,000 won. “We decided on 1,000 won to maintain active shareholder return by reflecting expectations for growth due to changes in business models,” the SKC official explained. [End]