Goryeong Zinc and Yeungpo: Second-Quarter Consolidated Operating Profit of Goryeong Zinc is 390 Times That of Yeungpo, Showing a 'Mix of Joy and Sorrow'

*This content was translated by AI.

The performance of the two smelting companies, Goryeong Zinc and Yeungpo, shows a stark contrast.

Goryeong Zinc recorded second-quarter consolidated sales of approximately 6.373 trillion won and an operating profit of about 587 billion won, representing increases of 66.6% and 126.8%, respectively, compared to the same period last year when sales were about 3.825 trillion won and operating profit was about 259 billion won.

In contrast, Yeungpo's second-quarter consolidated operating profit for this year was reported at approximately 1.5 billion won. Although it showed a recovery in performance with an operating profit of 43.3 billion won in the first quarter, it has dropped significantly in the second quarter.

The factory utilization rate of Seokpo Smelter, Yeungpo's main business unit, also declined from 57.23% in the first quarter to 51.7% in the second quarter. With concerns raised continuously by ISuga regarding environmental pollution risks at Seokpo Smelter recently, there are voices of worry that these burdens may persist for some time.

According to electronic disclosures by the Financial Supervisory Service, Yeungpo's second-quarter consolidated sales reached 853.2 billion won, an increase of about 42.2% compared to 599.8 billion won in the same quarter last year. Its operating profit turned from a deficit of 94.1 billion won in the second quarter of last year to a surplus of 1.5 billion won in the second quarter of this year. However, the surplus has decreased significantly compared to the 43.3 billion won operating profit recorded in the first quarter of this year.

Cumulative consolidated sales for the first half of the year reached 1.7043 trillion won, an increase of about 45.5% compared to the same period last year, and operating profit also turned into a surplus of approximately 44.8 billion won, marking a successful shift from deficit to surplus compared to the previous year.

However, industry observers are focusing on the fact that Yeungpo's first-quarter operating profit dropped from 43.3 billion won to just 1.5 billion won in the second quarter. In the case of Seokpo Smelter, Yeungpo's main business unit, the annual utilization rate last year was 45.95%, rebounding to 57.23% in the first quarter of this year, but falling again to around 51% in the second quarter.

Some are even speculating that, unlike last year when there were no operational suspensions or similar issues, the decline in factory utilization rate suggests that Yeungpo may be facing difficulties in normalizing its operations.

Furthermore, analyses suggest that Yeungpo's Seokpo Smelter is under continuous pressure from the government, political circles, and civic groups, which could act as a burden factor in normalizing its management.

Minister of Climate, Energy and Environment Kim Sung-hwan stated at the National Assembly's Climate, Energy, Environment, and Labor Committee plenary session on the 11th that regarding the relocation or closure of Seokpo Smelter, "If it is judged that Seokpo Smelter continuing to operate in its current location will hinder the entire Nakdong River ecosystem, then the most powerful measure the government can take is to suspend operations."

It is reported that the Seoul National Police Agency's Investigation Review Committee decided on the 11th to order a reinvestigation into the case of Jang Hyung-jin, Yeungpo's advisor, who was accused of violating the Environmental Crime Control Act and the Soil Environment Conservation Act, and assigned the Seoul National Police Agency's Major Crimes Division to handle the investigation.

In contrast, Goryeong Zinc, which is engaged in a management rights dispute with Yeungpo, achieved its highest-ever performance.

Goryeong Zinc recorded second-quarter consolidated sales of approximately 6.373 trillion won and an operating profit of about 587 billion won, representing increases of 66.6% and 126.8%, respectively, compared to the same period last year when sales were about 3.825 trillion won and operating profit was about 259 billion won.

Cumulative consolidated sales for the first half of the year also reached approximately 12.445 trillion won, a 62.5% increase compared to about 7.658 trillion won in the same period last year. First-half operating profit increased by 151.5%, rising from about 530 billion won last year to about 1.333 trillion won this year. Goryeong Zinc's Onsan Smelter has maintained a factory utilization rate of 100% during the first half of the year.

Industry experts evaluate that while both Yeungpo and Goryeong Zinc, the two parties in the dispute, share the common ground of non-ferrous metal smelting, there are significant differences in scale, product lines, and business areas.

In the case of Goryeong Zinc, it produces not only base metals such as zinc and lead but also precious metals like gold and silver, as well as many critical minerals including indium, antimony, and bismuth. It supplies semiconductor-grade sulfuric acid and possesses world-class technological capabilities, smelting expertise, and a diverse portfolio of products. In particular, under the leadership of Choi Yun-beom (Chairman), it is driving expanded investment in critical mineral fields and increasing recovery rates, leading to strengthened profitability according to analyses.

In contrast, Yeungpo's Seokpo Smelter operates as a single-purpose smelter focused on zinc production, with limited additional output of sulfuric acid from Busan water sources. Experts diagnose that this narrow operational scope makes it difficult to respond flexibly to market changes and boost performance.

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*This content was translated by AI.