EcoPro shares lose their charge on $40 million operating loss in Q2

Industry

EcoPro shares lose their charge on $40 million operating loss in Q2

Published: 31 Jul. 2024, 16:14

SARAH CHEA
chea.sarah@joongang.co.kr

EcoPro founder Lee Dong-chae speaks during the groundbreaking ceremony of the company's cathode plant in Hungary in April last year. [ECOPRO]

EcoPro shares dipped almost 4 percent Wednesday as the EV battery materials company fell into the red in the second quarter, hit harshly by slowing EV sales.

The company reported 54.6 billion won ($40 million) in operating losses during the April-June period, compared to 170.3 billion won of operating profit during the same period a year earlier.

Revenue plunged 57.2 percent on year to 864.1 billion won, logging a net loss of 63.6 billion won.

"Falling prices of key materials hit by the slowing demand of EVs dropped us into the red," said Park Jae-ha, head of business management at EcoPro, during a conference call on Wednesday.

Key battery-related subsidiaries also reported disappointing earnings.

EcoPro BM, a cathode materials maker, saw an almost 100 percent fall in operating profit to 3.9 billion won in the second quarter. Cathode materials are one of the four main materials in EV batteries, accounting for 40 percent of a battery's cost.

Revenue declined 57.5 percent to 810 billion won while turning to a net loss of 8.8 billion won.

"EcoPro BM is considering downsizing our cathode production capacity amid market uncertainties," Kim Jang-woo, head of business management at EcoPro BM, hinted on Wednesday.

EcoPro Materials, a precursor maker, also sank into the red to 3.7 billion won in operating losses, while revenue plummeted 77 percent to 66.7 billion won. Precursors are raw materials used to make cathodes.

Kosdaq-listed EcoPro BM shares fell 4.05 percent to close at 179,900 won on Wednesday, while EcoPro Materials slid 4.5 percent to 81,000 won.

BY SARAH CHEA [chea.sarah@joongang.co.kr]