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
Korea Refractories, a comprehensive refractory maker with Hyundai Steel as a core customer, saw 2025 revenue decline alongside a sharp drop in operating profit and a swing to net loss, while recent quarters continue to oscillate between profit and loss.
2025 consolidated revenue was KRW 406.3bn (down y/y), operating profit fell sharply to KRW 2.78bn, and net profit attributable to owners swung to a loss of KRW -21.79bn
Over the last five quarters (2025Q2-2026Q2), operating profit has alternated between losses and profits, reducing earnings visibility
The domestic refractory market is an oligopoly centered on a few players including Chosun Refractories, POSCO Future M, and Korea Refractories, but intensifying competition from Chinese products continues to pressure prices and quality
Hyundai Steel's Dangjin blast furnace relining plan, announced in 2019, remains delayed, keeping uncertainty around a major refractory demand event
As a Hoosung Group affiliate, governance and related-party transaction issues have previously been flagged and warrant ongoing monitoring
Korea Refractories was founded in Busan in 1973, changed to its current name in 1995, and listed on the KOSPI in 2000 as a comprehensive refractory materials producer.
The company manufactures and sells shaped, unshaped, and basic refractories, aluminum alloys and deoxidizers, and non-metallic fine powders, serving markets including iron and steel, cement, glass, heavy industry, and thermal power plants. Its subsidiary Ilkwang E&C operates in the construction business.
The company states it has secured competitiveness through technology agreements with firms such as Vesuvius (US), Kyushu Refractories (Japan), and Karrena (Germany).
Through the adoption of advanced overseas technology and in-house development, it has built a system capable of domestically supplying most products except certain specialty refractories.
The domestic refractory industry includes around 60 companies such as POSCO Future M and Chosun Refractories, with each supplier tailoring products to the specific requirements of its major clients.
Hyundai Steel is a core customer, and the company relocated its headquarters to Dangjin in 2009 to align with blast furnace construction at Hyundai Steel's Dangjin steelworks.
The company is the founding entity of Hoosung Group, an affiliate of the broader Hyundai family lineage, which comprises three listed companies—Hoosung, Korea Refractories, and Firstec—along with numerous unlisted affiliates.
While the refractory market has entry barriers requiring significant know-how and capital, industry sources note intensifying competition and product quality convergence are driving increased open competition among suppliers.
| Quarter | Revenue | Operating profit | Op. margin |
|---|---|---|---|
| 2025Q2 | ₩106.3B | -₩3.1B | −2.9% |
| 2025Q3 | ₩103.3B | ₩4.4B | 4.3% |
| 2025Q4 | ₩92.4B | ₩2.8B | 3.1% |
| 2026Q1 | ₩88.4B | -₩300M | −0.4% |
| 2026Q2 | ₩104.1B | ₩1.8B | 1.8% |
| Year | Revenue | Operating profit | Net income (parent) | Op. margin | ROE | Debt-to-equity |
|---|---|---|---|---|---|---|
| 2022 | ₩358.8B | ₩10.5B | ₩800M | 2.9% | 0.4% | 48.0% |
| 2023 | ₩411.8B | -₩7.5B | -₩14.7B | −1.8% | −7.2% | 62.0% |
| 2024 | ₩416B | ₩8.6B | ₩5.5B | 2.1% | 3.0% | 69.3% |
| 2025 | ₩406.3B | ₩2.8B | -₩21.8B | 0.7% | −12.5% | 58.1% |
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
2025 consolidated revenue came to KRW 406.3bn, a slight decline from KRW 416.0bn in 2024, while operating profit plunged to KRW 2.78bn (operating margin 0.7%) from KRW 8.59bn in 2024.
Net profit attributable to owners swung to a loss of KRW -21.79bn from a KRW 5.51bn profit in 2024, driven largely by a substantial net loss of KRW -27.14bn in 2025Q2.
On a quarterly basis, operating profit recovered sharply to KRW 4.41bn with net profit of KRW 9.37bn in 2025Q3, but 2025Q4 saw operating profit of KRW 2.84bn accompanied by a net loss of KRW -3.05bn, and 2026Q1 contracted further with an operating loss of KRW -0.31bn and net loss of KRW -0.56bn. 2026Q2 turned positive again with revenue of KRW 104.1bn, operating profit of KRW 1.82bn, and net profit of KRW 2.02bn.
Looking further back, the annual pattern has flipped direction almost every year: a modest profit in 2022 (revenue KRW 358.8bn, operating profit KRW 10.52bn, net profit KRW 0.81bn) deteriorated sharply in 2023 despite higher revenue of KRW 411.8bn, with an operating loss of KRW -7.54bn and net loss of KRW -14.73bn, before recovering in 2024 and reversing again into loss in 2025.
The debt ratio rose from 48.0% in 2022 to 62.0% in 2023 and 69.3% in 2024, before easing to 58.1% in 2025, while operating cash flow remained positive at KRW 7.72bn in 2025 despite the net loss.
This volatility appears to reflect a combination of raw material costs, pricing power in negotiations with clients, and differences in the timing of revenue recognition for large project-based sales across quarters.
The refractory industry is an upstream supplier of essential materials for high-temperature processes in base industries such as steel, cement, and glass, closely tied to downstream industry cycles.
Korea's steel industry faces combined pressures from low-priced Chinese imports, sluggish global demand, and prolonged construction sector weakness; a recent brokerage industry report assessed that domestic steel is entering an earnings improvement phase in 2026 off a low 2025 base.
However, core customer Hyundai Steel's three blast furnaces at its Dangjin steelworks have already exceeded their mechanical lifespans, yet relining plans remain unresolved seven years after being announced, while the company simultaneously pursues restructuring through an electric-furnace/blast-furnace hybrid process and expanded US investment—leaving the timing of any major refractory replacement demand uncertain.
The refractory market itself remains an oligopoly dominated by a handful of players including Chosun Refractories, POSCO Future M, and Korea Refractories, with high entry barriers, though industry participants note that quality convergence among suppliers and improving technical capability of Chinese products are intensifying price and quality competition.
Competitor Chosun Refractories has emphasized eco-friendly and resource-circulation strategies including waste refractory recycling along with a shift toward higher-margin business structures, suggesting green transition and cost competitiveness are emerging as common challenges across the industry.
No specific company-level revenue or profit guidance, nor large-scale capacity expansion plans, were confirmed. However, changes in the business strategy of core customer Hyundai Steel remain a key variable affecting future refractory demand.
Hyundai Steel has begun operating an electric-furnace/blast-furnace hybrid process to produce low-carbon steel sheets and is expanding investment in new North American facilities, pursuing a shift away from a blast-furnace-centric structure that leaves the long-term trajectory of domestic blast-furnace-related refractory demand uncertain.
Should the relining of the Dangjin No. 1-3 blast furnaces be finalized and scheduled, it could represent a major refractory demand event, but there has been little progress since the plan was first announced in 2019.
On the industry side, some views suggest domestic steel could see improved conditions in 2026 supported by easing Chinese supply pressure and anti-dumping measures, which could benefit refractory demand if downstream recovery materializes.
Given the company's recent pattern of alternating profit and loss quarters, whether this volatility stabilizes in coming quarters will be an important point to watch.
The current share price trades at a level well below book value per share, reflecting a discount to net assets.
However, given the company's pattern of alternating profits and losses in recent years—including a net loss in 2025 and a mix of profitable and loss-making quarters through the first half of 2026—this net-asset discount can be interpreted as reflecting a substantial degree of earnings uncertainty.
On the dividend front, historical payout ratios have varied between periods of relatively high payouts and periods with no dividend, making it difficult to identify a consistent shareholder return pattern.
The company's market capitalization also places it among smaller-cap names within the listed chemical sector, which may result in limited trading liquidity.
Given the company's characteristically volatile earnings, examining profit trends across multiple quarters alongside any single valuation multiple is a useful complement to interpretation.
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
The current share price trades at a level well below book value per share, implying a low multiple relative to asset value. The debt ratio also improved somewhat, falling from 69.3% in 2024 to 58.1% in 2025.
However, this may partly reflect earnings uncertainty, limiting the extent to which asset value alone can be relied upon.
In 2025Q3, the company posted a sharp recovery with operating profit of KRW 4.41bn and net profit of KRW 9.37bn, and 2026Q2 again turned profitable with operating profit of KRW 1.82bn and net profit of KRW 2.02bn. This suggests the company retains the capacity to restore profitability in certain quarters. However, the recovery has not been sustained, with a recurring pattern of quarter-to-quarter reversals.
The domestic refractory market is an oligopoly dominated by a small number of players including Chosun Refractories, POSCO Future M, and Korea Refractories, with high entry barriers.
With Hyundai Steel as a core customer and production facilities concentrated in Dangjin, the company holds a geographic and relational advantage in supplying blast-furnace-related refractories. Some industry views also suggest domestic steel could enter an improvement phase in 2026.
The company's annual results flipped direction almost every year: a profit in 2022, a large loss in 2023, a profit in 2024, and a return to loss in 2025. The last five quarters (2025Q2-2026Q2) also alternated between profit and loss, making it difficult to anticipate the direction of upcoming quarters. This volatility raises the level of uncertainty in assessing the company.
Hyundai Steel's three blast furnaces at Dangjin have already exceeded their typical lifespan, but relining plans announced in 2019 remain unconfirmed seven years later.
As Hyundai Steel restructures its business through an electric-furnace/blast-furnace hybrid process and expanded North American investment, there is a possibility that major domestic blast-furnace-related refractory demand could be delayed or reduced relative to expectations.
Competition among refractory makers is intensifying and product quality is converging, weakening established supply relationships with specific customers as the market opens to broader competition.
Improving technical capability of Chinese products and the establishment of local subsidiaries by domestic firms have intensified price and quality competition, weighing on overall profitability.
A significant portion of revenue is linked to the steel and steelmaking business cycle, so prolonged weakness in the steel industry could simultaneously weaken refractory demand and pricing power. This risk remains relevant given recent reports of steel companies' operating profits retreating due to cost pressures.
The company is the founding entity of Hoosung Group, part of the broader Hyundai family lineage, and past reports have flagged issues such as related-party transactions and disparities in dividend payout ratios among affiliates.
Reports of a sharp increase in the related-party transaction ratio at subsidiary Ilkwang E&C in a specific period suggest ongoing scrutiny of governance transparency is warranted.
The operating margin fluctuated significantly, from 2.9% in 2022 to -1.8% in 2023, 2.1% in 2024, and 0.7% in 2025. Raw material cost changes, pricing negotiation power, and differences in the timing of large project revenue recognition could combine to produce similar volatility going forward.
Expected timing of the 2026Q3 earnings disclosure; it will be important to check whether the recurring profit-loss alternation pattern of the last five quarters continues.
Check for concrete progress on Hyundai Steel's Dangjin blast furnace relining plan. If finalized, it could translate into a major refractory demand event.
The 2026 annual business report and regular shareholders' meeting will provide an opportunity to review confirmed annual results, dividend policy, and affiliate transaction disclosures.
Continuously monitor whether domestic steel industry conditions improve and how competitive intensity from Chinese refractory and steel products evolves.
Korea Refractories holds a stable position within Korea's oligopolistic refractory industry with Hyundai Steel as a core customer, but has shown high earnings volatility over recent years, with annual and quarterly results alternating between profit and loss.
In 2025, consolidated revenue declined slightly, operating profit contracted sharply, and net profit swung to a loss, with quarterly results continuing to alternate between profit and loss through the first half of 2026.
External variables—including delays in Hyundai Steel's blast furnace relining plan, its ongoing business restructuring, and mixed views on the domestic steel industry outlook—could further influence the company's earnings trajectory.
While the share price trades at a discount to net asset value, this may largely reflect earnings uncertainty rather than a straightforward value signal. Governance considerations tied to its position within Hoosung Group also warrant attention.
Upcoming quarterly results and progress on Hyundai Steel-related investment events are likely to serve as key reference points going forward.
Report written 2026-09-05 · Data as of 2026-09-04
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