1. H1 2025 Performance Analysis: Drivers of Profitability
Samil CNS recorded sales of KRW 58 billion and operating profit of KRW 2.3 billion in the first half of 2025, marking a return to profitability. The robust growth of the wind power/steel business division (36.5% sales increase) drove the improved performance. Notably, the company’s efforts to reduce selling, general, and administrative expenses amidst a challenging construction environment contributed to enhanced profitability.
2. Segment Performance: A Mixed Bag
The wind power/steel business division maintains a positive outlook, fueled by the growth of the offshore wind power market. Conversely, the concrete business division continues to struggle due to falling PHC pile prices, and the aggregate business division faces headwinds from the construction slowdown. These contrasting performances could significantly influence future stock price movements.
3. Key Investment Considerations
- Positive Factors: Growth potential of the wind power business, improved management efficiency through business restructuring
- Negative Factors: Continued sluggishness of the concrete business division, high dependence on debt financing and interest rate risk
4. Investment Strategies: Short-Term vs. Long-Term
Short-term investors: Focus on the return to profitability and the momentum of the wind power business, considering purchases during stock price corrections.
Long-term investors: Should continuously monitor the performance of the wind power business, the potential turnaround of the concrete business division, and improvements in financial soundness.
5. Key Metrics to Watch
- Increase in wind power business orders and contribution to sales
- Changes in sales volume and unit prices of the concrete business division
- Debt reduction and improvement in financial soundness indicators
- Improvement in cash flow from operating activities