Solus Advanced Materials announced on the 12th that it recorded consolidated revenue of 125.5 billion won and an operating loss of 30.1 billion won for the third quarter of this year. While revenue increased by 83.1% compared to the same period last year, the operating loss expanded from 26 billion won.
The revenue growth was driven by the battery foil business. Revenue in the battery foil segment reached 91.6 billion won, a 151.6% increase from the same period last year, marking its highest quarterly performance to date. It also rose by 22.1% compared to the previous quarter.
However, rising electricity costs and depreciation burdens hindered profitability improvements. Based on the Hungarian power exchange (HUDEX), electricity prices increased by approximately 38%, from an average of 109.2 euros per megawatt-hour (MWh) in the second quarter to 151.1 euros in the third quarter. As energy costs incurred during the battery foil production process rose, the operating loss widened.
The organic light-emitting diode (OLED) business recorded its highest quarterly revenue. Third-quarter revenue was 33.9 billion won, up 5.6% from the same period last year and 26.0% from the previous quarter. This was influenced by expanded supply of R-Prime for mobile devices and increased supply of patent-based hole transport layers (HBL) following the resumption of smartphone production by a Chinese client.
Solus Advanced Materials plans to improve profitability through price increases for battery foil. The company is currently negotiating price hikes with most of its clients, having already completed negotiations with some major customers.
The increased prices are expected to be reflected in fourth-quarter results. The company aims to continue negotiations with the remaining clients to gradually raise selling prices throughout next year. Battery foil is a core material used as the current collector for battery anodes.
The company also plans to respond to the expansion of the European electric vehicle and North American energy storage system (ESS) markets. In line with the European Union's (EU) moves to strengthen domestic production and supply chains, it will enhance the competitiveness of its local production facilities.
In North America, it will leverage the increased demand for ESS batteries driven by power infrastructure expansion as a new growth opportunity.
Kwak Geun-man, CEO of Solus Advanced Materials, stated, "We will finalize price increase negotiations with battery foil clients and respond to the expanding demand for European electric vehicles and North American ESS."
He added, "Next year, we will focus on improving profitability through sequential price increases, achieving earnings before interest, taxes, depreciation and amortization (EBITDA) targets, and turning quarterly profits positive during the year."
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