Q2 2024 SK Innovation Co Ltd Earnings Call Transcript
Key Points
- SK Innovation Co Ltd (XKRX:096770) reported robust E&P mining production despite weaker refining margins.
- The company expects a recovery in refining margins in the third quarter due to seasonal demand and tighter supply dynamics.
- SK Innovation Co Ltd (XKRX:096770) is focusing on improving its fundamental competitiveness through cost-saving efforts and operational improvements.
- The planned merger with SK E&S is expected to generate significant synergies, potentially adding KRW2.2 trillion in EBITDA by 2030.
- The company is actively expanding its customer and product portfolio, particularly in the EV battery market, to diversify its revenue streams.
- SK Innovation Co Ltd (XKRX:096770) reported a revenue decline of KRW56 billion quarter-over-quarter, primarily due to lower sales volume in the battery business.
- Operating profit fell by KRW670.5 billion, resulting in a loss of KRW45.8 billion for the quarter.
- The battery business faced significant challenges, including lower utilization rates and increased fixed costs, leading to an operating loss of KRW460.1 billion.
- The company’s debt-to-equity ratio remains high at 161%, indicating financial leverage concerns.
- Non-operating losses were substantial, amounting to KRW481.8 billion, driven by FX translation losses and derivative losses.
Good morning. We will begin SK Innovation's earnings conference call. Good morning. I am [Chung Soo Yong], PL of IR comm at SK Innovation. Thank you for joining the company's second-quarter-2024 earnings presentation.
I have with me SK Innovation's CFO, Kim Jin Won; and Lee Woo-Hyun, Head of IR and the management team from the subsidiary companies. We were first half, CFO, Kim Jin Won to run through the company-wide business results for the quarter, followed by business highlights each presented by respective members of the management team. We will also talk about recently announced merger plan between SK Innovation and SK E&S, expected outcomes and synergies, after which, we will entertain your questions. Please note that the earnings we're presenting today have yet to receive an audit, and thus, are subject to change upon the independent auditor's review.
With that, I will invite CFO, Kim Jin Won, to run through the second quarter earnings.
Yes. Good morning. I'm Kim Jin Won,
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