On April 28th, Huvis (CEO Bae-keun Yoo. 079980), specializing in chemical materials, announced preliminary results that the company is expected to record KRW287.4 billion in sales, KRW5.9 billion in operating profit and KRW3.7 billion in net income in the 1st quarter of 2016. (Consolidated) Its operating profit has dropped 11%, its pre-tax income was down 8% and its net income fell 42%, QoQ (4Q of 2015).

 

Upon viewing them separately, however, as its sales, operating profit and net income are expected to amount to KRW215.5 billion, KRW6 billion and KRW7.2 billion respectively, its non-consolidated operating profit, pre-tax income and net income rose by 83%, 207% and 78% respectively, QoQ (4Q of 2015). Its performance deteriorated in the 4th quarter of 2015 due to the slow season of the chemical fiber industry, but its performance succeeded in rebounding in the first quarter of 2016, and thus its profit ratio sharply increased.

 

A Huvis official remarked, “The non-consolidated operating profit of the 1st quarter of 2016 went up QoQ (4Q of 2015), but the profitability of its subsidiary in China waned due to the long-term repairs during the Spring Festival (Lunar New Year Holidays and the tougher competition among some products in China, and the KRW4.2 billion dividend of Huvis Water was expected to improve the pre-tax income on a non-consolidated basis, but as it was not reflected in the consolidated income, the consolidated performance slightly declined.”

“International oil prices, which fell due to oversupply in 2015, are expected to recover in the long run, and the costs of raw materials are increasing QoQ (4Q of 2015),” he added. “Selling prices will go up as the costs of raw materials are recovered, and profitability will be improved as the sales of high-value-added products will increase, while Huvis Water is currently making efforts to diversify its water treatment business. As a result, our performance is expected to improve in the second half.”

 

Meanwhile, the company’s debt-to-equity ratio and total borrowings and bonds payable to total assets (on a consolidated basis) are 117% and 23% respectively as of the end of the first quarter of 2016. The company seems to be maintaining the same financial stability that it did last year. (End of document)