New Risk • Apr 03
New minor risk - Earnings quality The company has large one-off items impacting its financial results. One-off items were 36% of the size of the rest of the company's trailing 12-month earnings before tax. This is considered a minor risk. One-off items are incomes or expenses that the company does not expect to repeat in future periods. Examples include profits from the sale of a business or expenses from a restructuring or legal settlements. If the company's reported statutory earnings include a large proportion of one-off items it means they may be an unreliable indicator of its true business performance as the earnings were skewed by these incomes or expenses. Currently, the following risks have been identified for the company: Major Risk Earnings have declined by 21% per year over the past 5 years. Minor Risks Unstable dividend paying track record with dividend experiencing an annual drop of over 20% in the past. Large one-off items impacting financial results. Profit margins are more than 30% lower than last year (0.6% net profit margin). Market cap is less than US$100m (₩47.7b market cap, or US$31.6m). Duyuru • Mar 13
CU-Tech Corporation, Annual General Meeting, Mar 31, 2026 CU-Tech Corporation, Annual General Meeting, Mar 31, 2026, at 10:00 Tokyo Standard Time. Location: conference room, 6, hyeongoksandan-ro 93beon-gil, cheongbuk-myeon, gyeonggi-do, pyeongtaek South Korea New Risk • Aug 28
New minor risk - Profit margin trend The company's profit margins are lower than last year and have reduced by more than 30%. Net profit margin: 1.3% Last year net profit margin: 3.5% This is considered a minor risk. A large drop in profit margin could indicate the company does not have strong competitive advantages or it is yet to establish itself and its core business. Even if it is a well established business, this may make it a much riskier investment than one that has a combination of proven competitive advantages and a stable or growing profit margin. Currently, the following risks have been identified for the company: Major Risk Earnings have declined by 20% per year over the past 5 years. Minor Risks Dividend is not well covered by earnings (130% payout ratio). Profit margins are more than 30% lower than last year (1.3% net profit margin). Market cap is less than US$100m (₩56.6b market cap, or US$40.8m). New Risk • Apr 03
New minor risk - Dividend sustainability The dividend is not well covered by cash flows. The company is paying a dividend despite having no free cash flows. Dividend yield: 7.2% This is considered a minor risk. Dividends are ultimately paid out of the company's available cash reserves. Companies that pay out too much of their cash flow are at risk of having to reduce or cut their dividend in future. If cash flow growth slows or cash flows fall, then there may not be enough cash reserves to maintain the same dividend. Or in extreme cases, companies may opt to take on debt to maintain the dividend. This risk is mitigated by the fact the dividend is covered by earnings, however, cash flows are generally more important. For dividend paying companies, any reduction in the dividend can significantly impact the share price. Currently, the following risks have been identified for the company: Major Risks Earnings have declined by 24% per year over the past 5 years. High level of non-cash earnings (36% accrual ratio). Minor Risks Paying a dividend despite having no free cash flows. Market cap is less than US$100m (₩57.6b market cap, or US$39.2m). New Risk • Apr 01
New major risk - Earnings quality The company has a high level of non-cash earnings. Accrual ratio: 36% This is considered a major risk. Non-cash earnings can arise from many different things. However, if a company consistently has a high level of non-cash earnings, it may be a sign that they are recognizing revenue from customers before the full value of the sales are received as cash or they are not depreciating the value of their assets appropriately. These are practices that inflate earnings, while not providing a similar increase to cash flows. Companies in some select industries naturally have a high level of non-cash earnings and it is not a major concern. However, in the worst case scenario it can be an early sign of performance manipulation by management. Currently, the following risks have been identified for the company: Major Risks Earnings have declined by 24% per year over the past 5 years. High level of non-cash earnings (36% accrual ratio). Minor Risk Market cap is less than US$100m (₩56.9b market cap, or US$38.7m). Duyuru • Mar 13
CU-Tech Corporation, Annual General Meeting, Mar 31, 2025 CU-Tech Corporation, Annual General Meeting, Mar 31, 2025, at 10:00 Tokyo Standard Time. Location: conference room, 6, hyeongoksandan-ro 93beon-gil, cheongbuk-myeon, gyeonggi-do, pyeongtaek South Korea New Risk • Dec 16
New major risk - Financial data availability The company has not reported any financial data. This is considered a major risk. With no or incomplete audited reported financial data, it is virtually impossible to assess the company's investment potential. Currently, the following risks have been identified for the company: Major Risk No financial data reported. Minor Risk Market cap is less than US$100m (₩52.2b market cap, or US$36.3m). Reported Earnings • Aug 16
Second quarter 2024 earnings released: EPS: ₩177 (vs ₩5.00 loss in 2Q 2023) Second quarter 2024 results: EPS: ₩177 (up from ₩5.00 loss in 2Q 2023). Revenue: ₩61.5b (up 118% from 2Q 2023). Net income: ₩3.13b (up ₩3.22b from 2Q 2023). Profit margin: 5.1% (up from net loss in 2Q 2023). The move to profitability was driven by higher revenue. New Risk • Jun 10
New major risk - Revenue and earnings growth Earnings have declined by 47% per year over the past 5 years. This is considered a major risk. Ultimately, shareholders want to see a good return on their investment and that generally comes from sharing in the company's profits. If profits are declining over an extended period, then in most cases the share price will decline over time unless the company can turn around its fortunes. A trend of falling earnings can be very difficult to turn around. If the company is well already established it may also be a sign the company has matured and is in decline. In addition, if the company pays dividends it will also likely need to reduce or cut them, striking a dual blow to total shareholder returns. Currently, the following risks have been identified for the company: Major Risk Earnings have declined by 47% per year over the past 5 years. Minor Risk Market cap is less than US$100m (₩68.3b market cap, or US$49.6m). Reported Earnings • May 19
First quarter 2024 earnings released: EPS: ₩259 (vs ₩12.00 in 1Q 2023) First quarter 2024 results: EPS: ₩259 (up from ₩12.00 in 1Q 2023). Revenue: ₩73.0b (up 120% from 1Q 2023). Net income: ₩4.58b (up ₩4.36b from 1Q 2023). Profit margin: 6.3% (up from 0.7% in 1Q 2023). The increase in margin was driven by higher revenue. Reported Earnings • Mar 23
Full year 2023 earnings released: EPS: ₩52.00 (vs ₩216 in FY 2022) Full year 2023 results: EPS: ₩52.00 (down from ₩216 in FY 2022). Revenue: ₩172.9b (down 20% from FY 2022). Net income: ₩918.6m (down 76% from FY 2022). Profit margin: 0.5% (down from 1.8% in FY 2022). The decrease in margin was driven by lower revenue. Upcoming Dividend • Dec 20
Upcoming dividend of ₩64.00 per share at 1.8% yield Eligible shareholders must have bought the stock before 27 December 2023. Payment date: 29 April 2024. The company is not currently making a profit but it is cash flow positive. Trailing yield: 1.8%. Lower than top quartile of South Korean dividend payers (3.5%). Higher than average of industry peers (0.9%). Reported Earnings • Sep 01
Second quarter 2023 earnings released: ₩5.00 loss per share (vs ₩181 profit in 2Q 2022) Second quarter 2023 results: ₩5.00 loss per share (down from ₩181 profit in 2Q 2022). Revenue: ₩28.3b (down 49% from 2Q 2022). Net loss: ₩88.1m (down 103% from profit in 2Q 2022). Valuation Update With 7 Day Price Move • Jan 19
Investor sentiment improved over the past week After last week's 17% share price gain to ₩4,870, the stock trades at a trailing P/E ratio of 7.8x. Average trailing P/E is 11x in the Electronic industry in South Korea. Total loss to shareholders of 28% over the past year. Upcoming Dividend • Dec 21
Upcoming dividend of ₩260 per share Eligible shareholders must have bought the stock before 28 December 2022. Payment date: 02 May 2023. Payout ratio is a comfortable 42% but the company is not cash flow positive. Trailing yield: 6.0%. Within top quartile of South Korean dividend payers (3.3%). Higher than average of industry peers (1.0%). Reported Earnings • Dec 01
Third quarter 2022 earnings released: EPS: ₩192 (vs ₩339 in 3Q 2021) Third quarter 2022 results: EPS: ₩192 (down from ₩339 in 3Q 2021). Revenue: ₩42.8b (down 40% from 3Q 2021). Net income: ₩3.38b (down 29% from 3Q 2021). Profit margin: 7.9% (up from 6.7% in 3Q 2021). The increase in margin was driven by lower expenses. Reported Earnings • Sep 01
Second quarter 2022 earnings released: EPS: ₩181 (vs ₩307 in 2Q 2021) Second quarter 2022 results: EPS: ₩181 (down from ₩307 in 2Q 2021). Revenue: ₩55.9b (down 7.1% from 2Q 2021). Net income: ₩3.20b (down 26% from 2Q 2021). Profit margin: 5.7% (down from 7.2% in 2Q 2021). The decrease in margin was driven by lower revenue. Valuation Update With 7 Day Price Move • Jun 23
Investor sentiment deteriorated over the past week After last week's 18% share price decline to ₩4,320, the stock trades at a trailing P/E ratio of 6.7x. Average trailing P/E is 12x in the Electronic industry in South Korea. Reported Earnings • Jun 02
First quarter 2022 earnings released: EPS: ₩26.00 (vs ₩307 in 1Q 2021) First quarter 2022 results: EPS: ₩26.00 (down from ₩307 in 1Q 2021). Revenue: ₩48.6b (down 19% from 1Q 2021). Net income: ₩462.6m (down 89% from 1Q 2021). Profit margin: 1.0% (down from 7.2% in 1Q 2021). The decrease in margin was driven by lower revenue.