1. What Happened?: Daegu Department Store’s Half-Year Report Casts a Dark Shadow

Daegu Department Store reported dismal results for the first half of 2025, with consolidated revenue of ₩12.5 billion, operating loss of ₩-2.4 billion, and net loss of ₩-6.9 billion. This goes beyond simple underperformance and poses a serious threat to the company’s survival.

2. Why This Happened?: Structural Difficulties and Weakening Competitiveness

Amidst the overall downturn in the department store industry, Daegu Department Store is facing the double whammy of weakening competitiveness. High interest rate burdens and weakened consumer sentiment have also contributed significantly to the deterioration of its financial condition. The poor performance of its core department store business is particularly concerning, and the real estate rental business alone cannot offset the losses.

  • Worsening Liquidity Crisis: Current liabilities significantly exceed current assets, leading to a severe liquidity shortage.
  • Increasing Debt Ratio: Financial soundness has deteriorated significantly, raising concerns about potential capital impairment.
  • Going Concern Uncertainty: The external auditor expressed concerns about ‘going concern uncertainties’ in the audit report.

3. What’s Next?: Future Outlook and Potential Scenarios

The future outlook for Daegu Department Store remains highly uncertain. The success of its financial restructuring plan is crucial, but the current situation is far from easy.

  • Potential Credit Downgrade and Default
  • Intensified Asset Sales and Restructuring
  • Increased Need for Additional Capital
  • Risk of Trading Suspension and Delisting

4. What Should Investors Do?: Investor Caution and Prudent Approach Required

Investing in Daegu Department Store currently carries very high risks. Short-term investments should be avoided, and even for long-term investment considerations, careful analysis of the company’s business model restructuring and the possibility of competitiveness recovery is essential. Experts recommend ‘sell’ or ‘hold’ opinions. Before making any investment decisions, consult with a professional and make careful judgments based on sufficient information.