PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩0 per share · Prices as of the 2026-10-02 close
SH Energy & Chemical, a leading domestic producer of EPS (expandable polystyrene) resin, posted four straight years of revenue decline and three consecutive years of net losses, but both operating profit and net income turned positive in Q2 2026.
Q2 2026 operating profit of KRW 94 million and owner net income of KRW 624 million marked the first simultaneous quarterly profit in five quarters.
FY2025 annual revenue of KRW 98.6 billion fell roughly 41% from FY2022's KRW 167.4 billion, marking four consecutive years of decline.
Owner's equity declined from KRW 93.9 billion in 2022 to KRW 69.5 billion in 2025, while the debt ratio rose from 31.9% to 46.1%.
The company continues diversifying its portfolio with cosmetics ingredient Nylon-12 Fine Powder (ANYBES) and semi-noncombustible insulation product DUOPOL alongside its core EPS resin.
A weak construction cycle and rising low-cost imports continue to pressure demand for commodity-grade products.
SH Energy & Chemical is a chemical materials company focused on synthetic resin and plastic raw material manufacturing, with EPS (expandable polystyrene) resin used in construction insulation and packaging materials as its core business.
The company was founded to manufacture and sell synthetic resins and plastic materials, later expanding into EPS resin, Nylon-12 Fine Powder (a cosmetics ingredient), resource development, and management consulting.
Its flagship EPS resin is an expandable resin used in insulation and packaging that has maintained steady demand in domestic and overseas markets.
Nylon-12 Fine Powder, marketed under the ANYBES brand for cosmetics use, has drawn attention in the premium functional cosmetics segment for its superior particle size and dispersion control.
In response to shrinking construction activity and tightening fire-safety standards, the company has commercialized semi-noncombustible EPS raw materials under brands such as DUOPOL, offering a new option in the insulation market.
The domestic EPS market is contested by global and large domestic players including BASF, Kumho Petrochemical, LG Chem, Lotte Advanced Materials, and Hyundai EP, and the company is reported to have long maintained a top-tier market share in this segment.
The company previously diversified into resource development through its US subsidiary SH Energy USA, which partnered with US shale gas developer SEECO by providing acreage and development costs.
More recently, the company appears to be pursuing production optimization, cost reduction, and export market diversification to strengthen its market response capability.
| Quarter | Revenue | Operating profit | Op. margin |
|---|---|---|---|
| 2025Q2 | ₩25.4B | -₩3.3B | −12.9% |
| 2025Q3 | ₩21.7B | -₩2.3B | −10.7% |
| 2025Q4 | ₩25.1B | -₩3.3B | −13.1% |
| 2026Q1 | ₩30.8B | -₩1.2B | −4.0% |
| 2026Q2 | ₩28.3B | ₩94,184,220 | 0.3% |
| Year | Revenue | Operating profit | Net income (parent) | Op. margin | ROE | Debt-to-equity |
|---|---|---|---|---|---|---|
| 2022 | ₩167.4B | ₩800M | ₩1.8B | 0.5% | 2.0% | 31.9% |
| 2023 | ₩134B | -₩4.1B | -₩2.6B | −3.1% | −2.9% | 34.0% |
| 2024 | ₩126B | -₩9.7B | -₩10.4B | −7.7% | −13.0% | 38.0% |
| 2025 | ₩98.6B | -₩12.2B | -₩10.8B | −12.4% | −15.5% | 46.1% |
Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-08-23
Annual results show a clear downtrend. Revenue fell from KRW 167.4 billion in 2022 to KRW 134.0 billion in 2023 (-19.9%), KRW 126.0 billion in 2024 (-6.0%), and KRW 98.7 billion in 2025 (-21.7%), marking four consecutive years of decline.
Operating profit swung from a KRW 0.8 billion surplus in 2022 to losses of KRW -4.1 billion in 2023, KRW -9.7 billion in 2024, and KRW -12.2 billion in 2025, with the operating margin deteriorating from 0.5% to -12.4% over the period.
Owner net income followed a similar path, moving from a KRW 1.8 billion profit in 2022 to losses of KRW -2.6 billion, KRW -10.4 billion, and KRW -10.8 billion in 2023, 2024, and 2025, respectively, marking three straight years of net losses.
Operating cash flow was positive at KRW 4.3 billion in 2023 but negative in 2022 (KRW -2.3 billion), 2024 (KRW -4.7 billion), and 2025 (KRW -3.9 billion), indicating weakened cash generation as well. Quarterly data, however, hints at a shift.
Operating losses fluctuated at KRW -3.3 billion, -2.3 billion, and -3.3 billion from Q2 to Q4 2025, with net losses persisting throughout, but the Q1 2026 operating loss narrowed to KRW -1.2 billion before the company posted an operating profit of KRW 94 million and owner net income of KRW 624 million in Q2 2026, its first simultaneous quarterly profit in five quarters.
The sum of owner net income over the trailing four quarters (Q3 2025-Q2 2026) remains a net loss of roughly KRW -5.3 billion, but the quarter-by-quarter narrowing of losses is notable.
Owner's equity fell from KRW 93.9 billion in 2022 to KRW 69.5 billion in 2025, and the debt ratio rose from 31.9% to 46.1% over the same period, though it remains far from a capital impairment level.
The domestic EPS industry is directly tied to demand for construction insulation and packaging materials, making it sensitive to the construction cycle.
According to industry data, demand for commodity products has declined due to a weak construction cycle, heightened exchange rate and raw material price volatility, and rising low-cost imports, though the company has maintained its domestic EPS market share through the launch of semi-noncombustible and high-insulation products and quality improvements, cited as a defining feature of the recent business environment.
The domestic EPS market is contested by global and large domestic conglomerate affiliates including BASF, Kumho Petrochemical, LG Chem, Lotte Advanced Materials, and Hyundai EP, forming a structure in which a small number of players divide the market.
Tightening fire-safety standards create new demand for semi-noncombustible and high-insulation products while simultaneously acting as substitution pressure on existing commodity products.
Inflows of low-cost imports, including from China, have intensified price competition and weighed on the profitability of domestic manufacturers.
Meanwhile, the cosmetics ingredient business follows a different demand cycle than construction materials, making the impact of K-beauty-related demand recovery on earnings a point of interest.
The company is reported to be continuing a strategy of expanding its semi-noncombustible and high-insulation product lineup and improving quality to offset slowing demand for commodity products.
In the cosmetics ingredient segment, post-pandemic economic recovery and K-beauty trends are expected to increase market sales of ANYBES products, with export market diversification being pursued.
Commercialization of the semi-noncombustible product DUOPOL and related technology transfer discussions are also said to be ongoing.
The narrowing of operating losses in Q1 and Q2 2026, followed by a swing to profit in Q2, could reflect improved cost structure or changes in the sales price-to-input cost spread, though whether this trend continues into subsequent quarters requires confirmation.
Whether the construction cycle recovers, along with the price of raw material styrene monomer (SM) and exchange rate volatility, remain variables with direct impact on earnings.
Whether the company's stated production optimization and cost-reduction plans translate into actual margin improvement is a point to watch going forward. The long-term contribution of the diversified resource development segment is also worth monitoring.
With net losses in three of the past four fiscal years, the company sits in a range where a conventional price-to-earnings ratio is difficult to compute. The share price trades at a level well below book value per share, reflecting a sustained discount to net assets.
As no dividend payment has been confirmed for the most recent fiscal year, there is no basis for calculating a dividend yield.
Looking at the multi-year earnings pattern, the company swung from profit in 2022 to losses from 2023 through 2025, with recent quarters showing a narrowing of losses that suggests some signs of recovery.
Such shifts in the earnings structure could influence valuation metrics going forward, making further quarterly confirmation necessary.
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 2026-08-23
After the Q1 2026 operating loss narrowed sharply from the prior quarter, both operating profit and owner net income turned positive in Q2 2026. This marks the first exit from a five-quarter losing streak and could signal improvement in cost structure or the sales-to-input cost spread. Whether this trend persists needs to be confirmed through future quarterly results.
Beyond EPS resin, the company has diversified revenue sources into cosmetics ingredient Nylon-12 Fine Powder (ANYBES) and semi-noncombustible insulation product DUOPOL. It notably holds two distinct growth drivers—tightening fire-safety standards and K-beauty demand recovery. This can be viewed as a structure that reduces reliance on a single construction cycle.
Although accumulated net losses have reduced owner's equity and pushed up the debt ratio, the 2025 debt ratio of 46.1% remains relatively low. The financial structure is far from capital impairment, implying relatively lower pressure for additional external funding.
Revenue fell roughly 41% from KRW 167.4 billion in 2022 to KRW 98.7 billion in 2025, declining for four consecutive years. A weak construction cycle and expanding low-cost imports are cited as the main drivers, and it remains uncertain whether this trend will reverse in the near term.
The company posted owner net losses for three straight years from 2023 to 2025, and owner's equity fell from KRW 93.9 billion in 2022 to KRW 69.5 billion in 2025. The debt ratio also rose from 31.9% to 46.1% over the same period, indicating gradually eroding financial buffer.
A weak construction cycle, exchange rate and raw material price volatility, and rising low-cost imports are repeatedly cited as continuing to pressure demand for commodity products. This appears to be a structural factor recurring over multiple years rather than a short-term event.
Demand for the flagship EPS resin is directly tied to construction insulation and packaging demand, so earnings volatility is closely linked to construction starts and investment trends. If the construction cycle recovery is delayed, revenue declines could persist.
Fluctuations in the price of styrene monomer (SM), a key raw material for EPS resin, and exchange rates directly affect the cost structure. A lag between rising input costs and price pass-through could compress margins.
Inflows of low-cost imported EPS products have been cited as intensifying price competition in the domestic commodity segment. Whether the strategy of differentiating through semi-noncombustible and high-insulation products can offset this pressure requires ongoing confirmation.
Timing of the Q3 2026 earnings disclosure, when it will be important to check whether the profit turnaround that began in Q2 continues.
Domestic construction start and investment statistics should be checked to gauge whether the construction cycle underlying EPS demand is recovering.
It is worth checking for new contracts or disclosures related to export market diversification for the ANYBES cosmetics ingredient, and whether K-beauty demand recovery translates into actual sales.
It is necessary to continuously monitor international styrene monomer (SM) prices and the KRW/USD exchange rate trend to track changes in the cost spread.
SH Energy & Chemical has long held a top-tier position in the domestic EPS market, but it has experienced four consecutive years of revenue decline and three consecutive years of net losses since 2022, alongside shrinking owner's equity and a rising debt ratio.
However, after the operating loss narrowed sharply in Q1 2026, both operating profit and net income turned positive in Q2, offering a signal of narrowing losses in the recent trend.
The company continues diversifying its product lineup with cosmetics ingredient ANYBES and semi-noncombustible insulation product DUOPOL, an ongoing attempt to reduce reliance on a single construction cycle.
Still, structural pressures such as a weak construction cycle, low-cost import competition, and raw material and FX volatility remain in place. Whether this quarterly profit turnaround is a one-off event or the start of a trend recovery requires further confirmation through subsequent quarterly results.
The financial structure remains far from capital impairment, suggesting relatively lower near-term concerns about financial stability.
Report written 2026-09-05 · Data as of 2026-09-04
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