PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩125 per share · Prices as of the 2026-10-02 close
Union sits at the intersection of a turnaround in its core white/alumina cement business and thematic attention on subsidiary Union Materials' rare-earth alternative ferrite magnets.
2025 consolidated revenue reached KRW 202.4bn with operating profit of KRW 5.5bn, turning positive from a KRW 11.5bn operating loss in 2024.
Operating profit alternated between gains and losses across the latest five quarters (2025Q2-2026Q2), showing no clear directional trend.
The debt-to-equity ratio eased from 200.6% in 2024 to 157.3% in 2025 but remains elevated.
Subsidiary Union Materials' ferrite magnet business shows theme-driven volatility whenever China tightens rare-earth export controls, spilling over into the parent's share price.
Cumulative owner net income over the trailing four quarters (2025Q3-2026Q2) far exceeds the sum of operating profit for the same period, warranting a check on non-operating items.
Union began producing white cement in 1964 and listed on the KOSPI in 1996, operating as a materials and building-materials affiliate of the OCI Group.
Its cement manufacturing division produces white cement, alumina cement and various special cements, while an environmental machinery division makes pollution-control equipment such as dehydrators.
Alumina cement, valued for its fire resistance and erosion resistance, is widely used as a binder for unshaped refractories and as raw material for special cement mortar in civil engineering and construction.
The company holds six consolidated subsidiaries, including Union Materials, Union Materials Vietnam, Union Tooltech, Yunong Agricultural Association, Union Resources and Daekwang Sojae.
Among these, Union Materials operates the ferrite magnet business, positioned as a rare-earth alternative material, along with ceramic components, and counts major domestic and global corporations such as Samsung Electronics and LG Electronics among its key customers.
Beyond cement, Union also produces rare metals such as molybdenum and vanadium, diversifying its materials portfolio.
In terms of governance, Chairman Lee Geon-young, a cousin of the late OCI Group chairman Lee Soo-young, and his eldest son Vice President Lee Woo-sun are the controlling shareholders of parent Union, holding stakes of 23.91% and 13.46% respectively.
Union's position as effectively the sole domestic producer of white cement gives it a distinctive competitive standing, though it also faces structural pricing pressure from low-cost imported white cement.
| Quarter | Revenue | Operating profit | Op. margin |
|---|---|---|---|
| 2025Q2 | ₩54.5B | ₩1.6B | 3.0% |
| 2025Q3 | ₩49.2B | -₩700M | −1.4% |
| 2025Q4 | ₩48.2B | ₩3.5B | 7.3% |
| 2026Q1 | ₩45.2B | -₩700M | −1.6% |
| 2026Q2 | ₩54B | ₩1.2B | 2.2% |
| Year | Revenue | Operating profit | Net income (parent) | Op. margin | ROE | Debt-to-equity |
|---|---|---|---|---|---|---|
| 2022 | ₩235B | ₩2.9B | -₩10.1B | 1.2% | −8.4% | 115.5% |
| 2023 | ₩224.6B | -₩2B | ₩7.3B | −0.9% | 5.6% | 117.4% |
| 2024 | ₩218.2B | -₩11.5B | -₩42B | −5.3% | −50.5% | 200.6% |
| 2025 | ₩202.4B | ₩5.5B | ₩23.4B | 2.7% | 21.7% | 157.3% |
Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-09-05
Consolidated revenue in 2025 came in at KRW 202.4bn, continuing a decline from KRW 218.2bn in 2024 and KRW 224.6bn in 2023, but operating profit swung to a positive KRW 5.5bn, recovering from a sizable KRW 11.5bn operating loss in 2024.
The operating margin improved from -5.3% in 2024 to 2.7% in 2025, and owner net income also reversed from a KRW 42.0bn loss in 2024 to a KRW 23.4bn profit in 2025. The recovery, however, has not been steady on a quarterly basis.
Operating profit came in at KRW 1.6bn in 2025Q2, -KRW 0.7bn in 2025Q3, KRW 3.5bn in 2025Q4, -KRW 0.7bn in 2026Q1 and KRW 1.2bn in 2026Q2, alternating between gains and losses.
Revenue across these five quarters also fluctuated without a clear upward trend, moving from KRW 54.5bn to KRW 49.2bn, KRW 48.2bn, KRW 45.2bn and KRW 54.0bn.
Meanwhile, the sum of operating profit over the trailing four quarters (2025Q3-2026Q2) totaled only about KRW 3.3bn, while cumulative owner net income for the same period reached KRW 65.7bn, a substantial gap between the two metrics.
This suggests a meaningful amount of non-recurring, non-operating gains, the specifics of which would require further disclosure confirmation.
On the balance-sheet side, the debt ratio jumped from 115.5% in 2022 and 117.4% in 2023 to 200.6% in 2024 before easing to 157.3% in 2025, while operating cash flow turned from a net outflow of KRW 9.6bn in 2022 to net inflows in each of the following three years (KRW 12.5bn, KRW 20.2bn and KRW 18.7bn), indicating improved cash generation.
The domestic cement industry appears to face simultaneous pressure from declining housing construction volumes and downward pricing pressure from low-cost imported white cement.
Company disclosures note that the cement manufacturing division faced downward price pressure from declining housing construction volumes and the inflow of low-priced imported white cement, underscoring the sector's sensitivity to the construction cycle.
The ferrite business, by contrast, shows a different trajectory, as the ferrite business segment showed improving performance as demand for automotive electronic components and home appliance motors increased, benefiting from expanding downstream demand.
Since the second half of 2025, China's tightening of rare-earth export controls has drawn renewed attention to supply concentration, given that China accounts for about 70% of global rare-earth production and is responsible for most of the global supply of heavy rare earths such as dysprosium and terbium, and Union Materials has been highlighted as part of the alternative-material supply chain since it produces ferrite-based permanent magnets that do not use rare earths with its own technology, supplying electric motors, generators and automotive sensors.
Domestically, competitors and comparable firms such as Samhwa Electronics, EG and Amogreentech exist in the ferrite and magnetic materials space, so Union Materials cannot be considered to hold a monopolistic position.
Still, it is noted that parent Union is regarded as one of the few domestic materials groups with an integrated process spanning ferrite raw materials, sintered bodies and magnet products, which is cited as a differentiator in terms of supply-chain vertical integration.
At the policy level, the Ministry of Trade, Industry and Energy stated that rare earths are a core raw material for advanced industries such as electric vehicles and semiconductors, and it would actively support domestic companies' efforts to diversify raw material sources, reflecting a continued policy push to foster alternative-material industries.
No specific numerical guidance from the company has been confirmed, so the outlook is described based on qualitative trends that have been verified.
The cement segment's performance is likely to remain tied to the housing construction cycle and pricing trends for imported white cement, and the recurring pattern of quarterly profit-and-loss swings suggests it is premature to conclude the business has entered a stable improvement trajectory.
The ferrite segment is driven both by a structural tailwind from expanding automotive electronics and home appliance motor demand, and by event-driven, theme-based trading that recurs whenever China tightens rare-earth export controls.
The fact that the government has been expanding joint research networks on rare earths and alternative materials with Japan, Australia and others since last month points to continued policy support for the alternative-materials industry over the medium to long term.
At the same time, it is worth noting that domestic rare-earth-related stocks have shown high volatility, surging and plunging whenever China's export restriction issues surface, so caution is needed regarding volatility expansion following short-term supply-and-demand-driven rallies.
If the large gap between trailing four-quarter cumulative net income and operating profit stems from one-off items, whether such items recur will be a key point to watch in future results.
In the cement segment, the trend of low-cost imported material inflows and domestic construction-start indicators, and in the ferrite segment, the pace of electrification demand from automakers and appliance makers, are cited as the key variables that will determine the direction of results.
Valuation metrics for this stock should be viewed together with the fact that trailing four-quarter cumulative net income appears substantially inflated relative to operating profit.
The price-to-earnings ratio currently sits below the band formed over the past several years of repeated profit-and-loss swings in the cement business, but this may reflect the non-operating gain effect mentioned above rather than a genuine improvement in the underlying business, warranting caution in interpretation.
The stock trades at a discount to net asset value, and the volatility in owner equity—falling from KRW 129.6bn in 2023 to KRW 83.1bn in 2024 before rising back to KRW 107.8bn in 2025—is also worth noting.
A cash dividend has been maintained based on the most recent settlement, but its continuity and size may depend on the extent of future earnings recovery. On balance, valuation metrics are best interpreted alongside the qualitative composition of net income rather than through a simple cheap-versus-expensive framing.
PER, EPS, PBR and BPS are all calculated in-house (the same method as Naver and Toss) · Dividend yield = cash dividend per share from DART filings (supplemented by KRX) ÷ current price · As of 2026-09-05
Operating profit turned positive at KRW 5.5bn in 2025, reversing from an KRW 11.5bn loss in 2024, and operating cash flow posted net inflows for three consecutive years from 2023 to 2025. The debt ratio also eased from 200.6% in 2024 to 157.3% in 2025.
This suggests the core cement and environmental machinery businesses have at least moved past their worst phase.
Subsidiary Union Materials' ferrite magnets have shown improving performance backed by rising demand for automotive electronic components and home appliance motors. A pattern has also formed in which the business draws market attention as an alternative material whenever China repeats rare-earth export controls.
The government has likewise stated policy support for raw material diversification and alternative material development.
Union is an OCI Group affiliate with Chairman Lee Geon-young and Vice President Lee Woo-sun holding a stable controlling stake.
Its position as effectively the sole domestic white cement producer, along with its status as a materials group with an integrated process from ferrite raw materials to magnet products, supports a distinctive competitive standing. The portfolio is also diversified through rare metal businesses such as molybdenum and vanadium.
The cement manufacturing division faces downward price pressure from declining housing construction volumes and inflows of low-cost imported white cement. This reflects a structural vulnerability in which results depend heavily on the domestic construction cycle. Revenue also declined for four consecutive years, from KRW 234.9bn in 2022 to KRW 202.4bn in 2025.
The debt ratio exceeded 100% in all four years from 2022 to 2025, spiking to 200.6% in 2024. Owner net income has also swung sharply, posting large losses of KRW 10.1bn in 2022 and KRW 42.0bn in 2024.
Operating profit over the latest five quarters has also alternated between gains and losses, leaving results with relatively low predictability.
The sum of operating profit over the trailing four quarters was only about KRW 3.3bn, while cumulative owner net income for the same period reached KRW 65.7bn, a very large gap between the two metrics.
Since this gap may stem from non-operating or one-off items, net income levels could fall sharply going forward if such items do not recur. The specific composition of this income requires confirmation through further disclosure.
A slowdown in domestic housing construction combined with continued inflows of low-cost imported white cement pressures both pricing and volume in the cement segment. If construction activity contracts further, the recent turnaround in the core business could be undermined again. Raw material price fluctuations could also add to cost burdens.
Shares of both Union Materials and parent Union have shown a pattern of sharp swings whenever news breaks regarding China's rare-earth export controls. Such moves tend to be driven more by news events than by fundamental improvement, so the risk of a pullback after short-term spikes persists. If related issues subside, thematic investor interest could also exit quickly.
The debt ratio has consistently exceeded 100%, and both owner and non-controlling equity have shown large year-to-year swings. The structure in which trailing four-quarter net income far exceeds operating profit is a factor that warrants scrutiny in terms of earnings quality. If non-operating gains fade, the pace of balance-sheet improvement could be slower than expected.
Timing of the 2026 Q3 provisional earnings disclosure, when it will be worth checking whether operating profit remains positive and whether revenue shows signs of recovery.
Any additional Chinese rare-earth export control measures or developments in US-China trade negotiations, and the resulting volatility in Union Materials' share price and trading flows, should be monitored.
Domestic housing construction-start indicators, white cement market pricing and the trend of low-cost import inflows should be checked to gauge the direction of the cement segment.
Timing of the 2026 annual business report (audit report) disclosure, when the detailed cause of the large gap between net income and operating profit seen over the trailing four quarters should be confirmed with finalized data.
Union moved out of its severe 2024 loss phase as both operating profit and owner net income turned positive in 2025, but the lack of a stable trend across the latest five quarters—alternating between operating gains and losses—means the recovery's durability is not yet clear.
The core cement business continues to face structural pressure from a slowing housing construction cycle and inflows of low-cost imported cement, which appears to be behind four consecutive years of revenue decline.
In contrast, subsidiary Union Materials' ferrite magnet business is benefiting from both a structural tailwind from expanding electrification demand and an event-driven tailwind tied to China's rare-earth export control issues.
The fact that cumulative owner net income over the trailing four quarters far exceeds the sum of operating profit for the same period points to the influence of non-operating or one-off items, a point that requires further confirmation in terms of earnings quality.
The debt ratio has eased somewhat since its 2024 spike but remains elevated, warranting continued monitoring of financial soundness.
Overall, this is a stock where a gradual recovery in the traditional materials business coexists with volatility from the rare-earth alternative material theme, making it worth watching how both dynamics unfold together.
Report written 2026-09-05 · Data as of 2026-09-04
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