Youil Energy Tech suffered a loss of up to 65%

In recent years, the secondary battery equipment sector in South Korea has been hit by a wave of disruption, with demand temporarily stagnant and stock prices struggling to gain support. Especially for Youil Energy Tech, a manufacturer of secondary battery equipment, as the company is a latecomer to the laser equipment market, its sales cost burden is relatively high. It is expected that in the future, the performance of Youil Energy Tech entering the laser equipment market and the speed of performance improvement will become decisive factors affecting the company's value direction.

According to publicly available information, Youil Energy Tech's consolidated sales last year were approximately KRW 59.6 billion, an increase of 60.88% from the previous year. But the sales cost is as high as 65.2 billion Korean won, with a sales cost ratio of 109%. This directly led to an increase in operating losses from KRW 10.1 billion in 2023 to KRW 16.7 billion last year. Its sales cost rate in 2023 will reach 95.4%. This is also the reason for Youil Energy Tech's long-term deficit structure.

Some industry insiders believe that this is due to the company's high initial cost burden when entering a new market. It is understood that Youil Energy Tech initially relied on SK On for over 90% of its sales, but is currently diversifying its customer base by entering the European market. In order to actively explore overseas markets, price competitiveness can be emphasized, and in the process of adjusting new equipment according to customer specifications, costs may be higher than expected.

The good side is that Youil Energy Tech is not stagnant, but challenging itself. The company initially started as a manufacturer of mold slotting equipment, entering this market by developing laser equipment with advantages in speed, accuracy, productivity, and maintenance. At first, it may cost a lot, but if you don't accept the challenge, the company won't have a chance to take off. Of course, the key still depends on how the enterprise overcomes the current difficult situation. In addition, Youil Energy Tech is also fully committed to the research and development of all solid state battery processing equipment.

The leadership of Youil Energy Tech has stated that in the process of entering new markets, we have invested too much in sales expenses. In the past, we focused on a single product line to create sales, but now we are entering the square and all solid state markets, and due to our focus on the domestic market and entry into the European market, we have invested too much in sales expenses in some areas.

Source: Yangtze River Delta Laser Alliance