Kolmar Korea shares were weak early on the 10th. As third-quarter earnings fell short of expectations and uncertainty ahead grew, brokerages have been cutting their target prices one after another.
As of 9:17 a.m. that day, Kolmar Korea was trading at 65,800 won, down 6,300 won (8.74%) from the previous session.
Kolmar Korea posted consolidated sales of 683 billion won and operating profit of 58.3 billion won in the third quarter of this year. The figures were up 9% and 7%, respectively, from a year earlier. However, as losses at the U.S. subsidiary widened, operating losses at overseas subsidiaries were greater than expected.
Of the 12 securities companies that issued reports on Kolmar Korea that day, 11 lowered their target prices. Kiwoom Securities (130,000 won → 110,000 won), Sangsangin Investment & Securities (130,000 won → 100,000 won), DB Securities (130,000 won → 100,000 won), Hyundai Motor Securities (130,000 won → 94,000 won), Daishin Securities Co. (130,000 won → 90,000 won), DAOL Investment & Securities (120,000 won → 100,000 won), NH Investment & Securities (110,000 won → 95,000 won), Mirae Asset Securities (110,000 won → 95,000 won), Shinhan Investment & Securities (112,000 won → 95,000 won), SK Securities (100,000 won → 90,000 won), and Yuanta Securities Korea (107,000 won → 88,000 won). Only Kyobo Securities maintained its previous 125,000 won.
Cho So-jung, an analyst at Kiwoom Securities, said, "Kolmar Korea projected a 4% to 6% domestic subsidiary sales growth rate in the fourth quarter of this year, which is somewhat disappointing considering it is a leading domestic beauty original design manufacturer (ODM)."
Jeong Ji-yoon, an analyst at NH Investment & Securities, noted, "As the utilization rate at the U.S. plant has declined, fixed-cost burdens are likely to persist for the time being, marking a period of weakened short-term earnings momentum," adding, "It is necessary to enhance the growth rate in the first half of next year."