Waps Co Ltd

Waps Co Ltd maintains a debt-to-equity ratio of 0.88, indicating a relatively balanced capital structure, though not overly conservative. The company's liquidity position is characterized as medium risk, with a current ratio of 1.55, suggesting it can cover short-term obligations but with limited buffer. Free cash flow of 571,548,050 KRW supports operational flexibility, though capital expenditures of -75,205,450 KRW indicate some reinvestment in the business.

Profitability metrics reveal a return on equity of 0.45% and a return on assets of 0.23%, both of which are below the typical thresholds for industry-leading performance. The company's operating income of 294,430,810 KRW and net income of 154,132,500 KRW suggest modest profitability, with a gross profit margin of 22.9%. These figures are in line with the industry's median performance, but not indicative of strong competitive advantage.

Geographically and segment-wise, Waps Co Ltd's revenue is concentrated in a single disclosed segment, with no further breakdown provided in the available data. This lack of diversification may expose the company to sector-specific risks, particularly in the volatile commodity chemicals market.

Looking ahead, the company's revenue outlook is constrained by the current economic environment and industry dynamics. The most recent actual EPS of -16.00 KRW indicates a challenging earnings environment, with no clear signs of improvement in the near term. The absence of detailed guidance for the next fiscal year suggests uncertainty in the company's growth trajectory.

Risk factors include a liquidity risk due to negative net cash after subtracting total debt, which could limit the company's ability to fund operations or respond to market changes. The dilution risk is currently low, with no significant dilution potential identified in the basic shares outstanding. However, the company's reliance on long-term debt (30,428,235,970 KRW) introduces refinancing risk if interest rates rise or credit conditions tighten.

Recent events, including the latest financial filing, highlight the company's ongoing challenges in maintaining profitability. The negative EPS and low return metrics suggest that management may need to implement cost-cutting measures or explore new revenue streams to improve performance.

Revenue surged 26.7% year-over-year to 43.2 billion KRW, demonstrating strong top-line growth momentum for the company.

Net income expanded 243.1% to 4.1 billion KRW, indicating a significant recovery in profitability compared to the prior year.

Free cash flow increased 86.4% to 4.9 billion KRW, reflecting improved operational cash generation capabilities.

Cash conversion ratio of 6.07 ranks best-in-class among 600 commodity chemical peers, highlighting superior efficiency.

Capital expenditure relative to revenue is above the 75th percentile, suggesting lower reinvestment needs than most peers.

Return on equity of 0.45% is significantly below the 3.61% cohort median, indicating poor capital efficiency.

Debt-to-equity ratio of 0.88 is in the bottom quartile, signaling higher financial leverage risk than peers.

The company faces high credit risk, posing potential challenges in maintaining financial stability and access to capital.

Revenue KRW 35.05B; Operating income KRW 780.4M.

• ▍Revenue KRW 35.05B
• ▍Operating income KRW 780.4M
• ▍Net margin 1.5%