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(Photo= Yonhap news) |
[Alpha Biz= Reporter Kim Minyoung] GS Construction-affiliated KOSPI company 'Xi S&D' has seen a significant downward revision in its annual performance estimates.
On the 19th, KB Securities maintained its target price for Xi S&D at 6,000 won with a 'Buy' rating. The first-quarter sales were reported at 400.5 billion won, a decrease of 47.8% compared to the same period last year, while operating profit plummeted by 98.7% to 6 billion won. This decline was influenced by the partial completion of affiliate projects and a sharp drop in construction and Home Improvement (HI) sales revenue.
Revenue from the housing sector fell by 15.1% year-on-year due to reduced project sales from decreased new orders and worsened cost factors such as raw material prices. The gross profit margin turned negative. The construction sector, recording a 72.1% decline compared to the previous year, experienced a substantial decrease in profit due to the completion of projects by affiliate GS Construction and a slowdown in revenue realization from new orders.
The HI sector also saw decreases in revenue (down 33.6% year-on-year) and gross profit (down 47.5% year-on-year). Revenue from real estate operations declined by 30.0% compared to the previous year due to sluggish market conditions.
KB Securities forecasts Xi S&D's annual revenue to decline by 28.7% year-on-year to 2.7 trillion won and expects operating profit to reach 640 billion won (a 49.3% decrease from the previous year).
Alphabiz Kim Minyoung (kimmy@alphabiz.co.kr)
