1. Bumyang Construction’s Q2 Earnings: A Sinking Ship
Bumyang Construction recorded KRW 16.3 billion in sales in Q2 2025, but remained mired in massive losses, reporting an operating loss of KRW 23 billion and a net loss of KRW 22.5 billion. Consecutive quarters of declining sales and persistent losses raise serious doubts about the company’s fundamental ability to generate profit, intensifying concerns about its management crisis.
2. Analyzing the Deteriorating Fundamentals
- Expanding Losses from Investments in Affiliates: The deteriorating financial health of its affiliates has further amplified Bumyang Construction’s losses.
- Worsening Financial Health of the Largest Shareholder: The financial difficulties of its largest shareholder, Plasco&B Co., Ltd., raise questions about Bumyang Construction’s management stability and investment capacity.
- Construction Industry Downturn: External factors such as high interest rates, real estate slump, and rising raw material prices have contributed to Bumyang Construction’s poor performance.
3. Growing Going Concern Uncertainty: Can the Company Survive?
Continuous large-scale losses are escalating the uncertainty surrounding Bumyang Construction’s going concern status. The company’s future ability to secure funding and successfully implement its turnaround plan will be crucial for its survival.
4. Action Plan for Investors: Proceed with Extreme Caution
Investing in Bumyang Construction requires extreme caution. Investors should carefully consider the following:
- Liquidity securing measures
- Risks associated with PF projects
- Business restructuring and management improvement efforts
- Macroeconomic changes