1. What Happened? H1 2025 Earnings Overview
C&G High-Tech’s revenue for the first half of 2025 decreased by 20.4% year-over-year to KRW 119.7 billion. Operating profit and net profit also declined by 41.3% and 8.5%, respectively. Q2 2025 performance was particularly weak compared to Q1, intensifying investor concerns. Declining sales of its core product, chemical mixing equipment, are considered the primary cause of the overall slump.
2. Why Did This Happen? Analyzing the Earnings Decline
The decrease in facility investment within the semiconductor/display industry, coupled with reduced customer spending, directly impacted C&G High-Tech’s performance. Rising raw material prices and increased operating expenses from new business investments also contributed to the decline in profitability.
3. What’s Next? Future Outlook and Growth Potential
The short-term outlook suggests continued challenges. However, C&G High-Tech is actively investing in new businesses with high growth potential, including thermal interface materials, low-k FCCL, and etching gas. If these new ventures show tangible results, the company’s value could appreciate in the mid-to-long term.
4. What Should Investors Do? Investment Strategy and Key Considerations
- Monitor Short-Term Earnings: Closely observe quarterly earnings trends to assess sales recovery and profitability improvement.
- Track New Business Performance: Monitor market penetration, revenue contribution, and technological competitiveness of new businesses.
- Evaluate Financial Health: Assess the company’s efforts to secure stable cash flow and improve its financial structure.
- Consider Macroeconomic Factors: Factor in macroeconomic variables, such as semiconductor/display industry forecasts, exchange rates, and interest rates, when making investment decisions.
What is C&G High-Tech’s main business?
C&G High-Tech primarily manufactures chemical supply equipment used in semiconductor/display manufacturing processes. Recently, they have diversified into new business areas, including thermal interface materials, low-k FCCL, and etching gas.
Why were H1 2025 earnings disappointing?
The main reasons were the decrease in facility investments within the semiconductor/display industry and reduced customer spending. Rising raw material prices and increased expenses related to new business investments also played a role.
What is the outlook for C&G High-Tech’s future growth?
While short-term challenges are anticipated, C&G High-Tech is viewed as having mid-to-long-term growth potential due to its active investment in new businesses. The key factor will be whether these new ventures deliver tangible results.
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