KOSDAQBiotech & Pharma018680

Seoul Pharma

₩1,941▲ 0.10%2026-10-02 close

Market Cap

₩22.6B

Turnover

₩4,004,648

Volume

2,076 shares

Shares out.

11.7M

PER

13.0×

PBR

0.6×

EPS

₩149

Dividend Yield

0.00%

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

Report overview

Operating Loss Persists, Net Profit Holds: A Look at Earnings Quality

Seoul Pharma posted an operating loss in 2025 but kept owner net profit positive for a fourth consecutive year, with most of the trailing four-quarter net profit concentrated in a one-off gain in the third quarter of 2025.

1
2025 revenue of KRW 52.1 billion slipped modestly year over year, while operating profit swung to a loss of KRW 1.28 billion
2
Owner net profit stayed positive for four straight years from 2022 to 2025, though the amount has fluctuated significantly each year
3
The KRW 2.62 billion net profit in Q3 2025 accounts for most of the KRW 1.74 billion net profit accumulated over the trailing four quarters
4
Gross margin of 60.4% ranks among the higher tier of listed pharma firms, but an SG&A ratio of 62.9% erodes profitability at the operating line
5
The company continues expanding ODF-based manufacturing and small overseas supply deals, though it has a history of large export contracts being cancelled

Business structure

Seoul Pharma Co., Ltd. is a KOSDAQ-listed pharmaceutical company specializing in oral drug formulation technology, producing orally disintegrating film (ODF) products based on its proprietary SmartFilm platform.

Its flagship product is Vultis, a sildenafil citrate erectile dysfunction treatment in film form, alongside an ODF lineup including Obicare for overactive bladder and Tamin-B for stomatitis and vitamin supplementation.

Recently, the sales mix has shifted, with peptic ulcer drugs such as Seoul Famotidine Tab and Exatide capsule gaining share while obesity drugs such as Pendizin Tab and Weltmin Tab have declined.

Company officials have stated that first-generation generics timed to patent expirations of blockbuster diabetes drugs, along with improved new drugs for dyslipidemia and gastroesophageal reflux disease, are in preparation.

The company operates a dedicated ODF manufacturing facility at the Osong Life Science Complex and has expanded into health-food ODF manufacturing, including a product called Immune Health & Premium Red Ginseng Film, backed by health-supplement GMP certification.

Overseas, small-scale supply contracts continue, including an exclusive Vultis supply agreement with Taiwan's Centerlab Co., though the realization of large contracts has been uneven — a roughly KRW 111.1 billion China export contract was cancelled six years after being signed.

Domestically, the ODF competitive landscape includes CTC Bio, CMG Pharma, and CL Pharm, with Seoul Pharma emphasizing high-dose loading and taste-masking technology as differentiators.

Since a 2020 change of control to private equity firm Q Capital Partners, the company has pursued continued operational efficiency, and improved financial metrics have been reflected in its re-entry into the KOSDAQ venture company segment.

Earnings trend

Quarterly revenue · Operating profit

₩12B-₩900M25Q2₩13.6B-₩33,603,51925Q3₩13.6B-₩200M25Q4₩12.1B-₩200M26Q1₩11.8B-₩300M26Q2

RevenueOperating profit

Annual revenue · Operating profit

₩50.1B₩1.7B2022₩52.5B₩1.2B2023₩53.6B₩1.5B2024₩52.1B-₩1.3B2025

RevenueOperating profit

Quarterly results · Last 5 quarters
Quarter	Revenue	Operating profit	Op. margin
2025Q2	₩12B	-₩900M	−7.6%
2025Q3	₩13.6B	-₩33,603,519	−0.2%
2025Q4	₩13.6B	-₩200M	−1.6%
2026Q1	₩12.1B	-₩200M	−1.5%
2026Q2	₩11.8B	-₩300M	−2.9%

Annual results
Year	Revenue	Operating profit	Net income (parent)	Op. margin	ROE	Debt-to-equity
2022	₩50.1B	₩1.7B	₩900M	3.5%	2.4%	76.2%
2023	₩52.5B	₩1.2B	₩3.5B	2.3%	9.1%	64.2%
2024	₩53.6B	₩1.5B	₩1.7B	2.9%	4.2%	78.3%
2025	₩52.1B	-₩1.3B	₩800M	−2.5%	1.8%	74.8%

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

Earnings analysis

Consolidated revenue in 2025 was KRW 52.1 billion, down about 2.7% from KRW 53.6 billion in 2024. Operating profit swung from a gain of KRW 1.53 billion in 2024 to a loss of KRW 1.28 billion in 2025, a clear deterioration compared with 2023 (KRW 1.21 billion) and 2022 (KRW 1.74 billion).

Yet owner net profit remained positive at KRW 0.75 billion in 2025, extending a four-year streak of net profit despite the operating loss (KRW 1.70 billion in 2024, KRW 3.52 billion in 2023, KRW 0.86 billion in 2022).

The gap between operating and net results is even starker on a quarterly basis: in Q3 2025, the operating loss was a minimal KRW 34 million, yet owner net profit reached KRW 2.62 billion, accounting for most of the KRW 1.74 billion in net profit accumulated over the trailing four quarters (Q3 2025 through Q2 2026).

By contrast, Q2 2025 (-KRW 1.33 billion), Q4 2025 (-KRW 0.38 billion), Q1 2026 (-KRW 0.19 billion), and Q2 2026 (-KRW 0.32 billion) all posted net losses, underscoring persistent weakness at the operating level. The debt ratio fell to 64.2% in 2023 before rising again to 78.3% in 2024 and 74.8% in 2025.

On a positive note, operating cash flow turned to a positive KRW 1.89 billion in 2025 from a negative KRW 3.01 billion in 2024.

Gross margin of 60.4% places the company among the higher tier of listed pharmaceutical firms, but an SG&A ratio of 62.9% consumes most of that gross profit, explaining the operating-level loss.

Industry analysis

In 2025, 65 listed pharmaceutical companies (35 on KOSPI, 30 on KOSDAQ) posted combined revenue of KRW 28.11 trillion, up 7.60% year over year, with operating profit of KRW 1.92 trillion (+7.91%) and net profit of KRW 1.54 trillion (+43.25%), reflecting broad sector growth.

However, this growth was led mainly by large-cap firms, and performance diverged sharply among smaller KOSDAQ pharmaceutical companies.

In fact, eight companies — including Yeon Pharm, Samil Pharm, CMG Pharma, Kukje Pharma, Whall Pharm, Seoul Pharma, Hanall Biopharma, and Hankook Pharm — saw operating profit swing to a loss in 2025.

The ODF segment in which Seoul Pharma operates includes competitors such as CTC Bio, CMG Pharma, and CL Pharm, and industry observers note that domestic enthusiasm for film-form drug development has cooled somewhat compared with prior years.

On gross margin, Seoul Pharma's 60.4% ranks among the top tier — roughly 9th — of listed pharmaceutical and bio companies, but its SG&A ratio of 62.9% far exceeds the KOSDAQ average of 37.2%, preventing that gross profit from translating into operating income.

In the addressable market, competition among improved new drugs and first-generation generics remains active in chronic disease areas such as diabetes, dyslipidemia, and gastroesophageal reflux disease, as well as in health-supplement products.

Outlook

The company has indicated it is preparing first-generation generic launches timed to patent expirations of chronic-disease and diabetes blockbuster drugs, which could expand the revenue share of peptic ulcer and metabolic disease products going forward.

In the ODF health-supplement segment, the launch of Immune Health & Premium Red Ginseng Film is intended to support expansion into product lifecycle management and contract manufacturing (CMO) business, opening room for revenue diversification beyond core pharmaceuticals.

Overseas, small country-specific supply contracts continue, such as in Taiwan, but given the company's history of large export contracts being cancelled, verifying the actual execution and revenue recognition of new deals will be important.

With operating profitability showing no clear improvement over the trailing four quarters, SG&A efficiency and expansion of ODF manufacturing are cited as key variables for a recovery in profitability.

Whether a large one-off net profit factor similar to Q3 2025 recurs is also worth watching in coming quarterly results. Since the debt ratio has risen again after bottoming in 2023, the direction of balance-sheet management also warrants observation.

Valuation

PER

13.0×

PBR

0.6×

ROE

4.4%

EPS

₩149

BPS

₩3,496

Dividend per share

₩0

Seoul Pharma has shown diverging directions between operating profit and net profit in recent years, with 2025 illustrating a structure where net profit was preserved despite an operating loss.

On a trailing four-quarter basis, a one-off factor in a specific quarter contributed heavily to the cumulative net profit, meaning this qualitative variance in earnings could factor into how the market prices the shares.

The share price relative to net assets has varied over time, reflecting the company's multi-year earnings volatility, and based on the most recent disclosures the shares have traded at a level below book value.

Dividend history has not shown a clear recent payment pattern, limiting the basis for evaluating dividend-related metrics. Specific judgments on trading multiples may differ by investor perspective, and this report is intended to convey disclosed financial figures and confirmed business developments.

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

Bull factors

Four Straight Years of Net Profit

Owner net profit stayed positive for four consecutive years — KRW 0.86 billion in 2022, KRW 3.52 billion in 2023, KRW 1.70 billion in 2024, and KRW 0.75 billion in 2025 — despite fluctuating amounts.

Even in 2025 when operating profit turned negative, the company still preserved a net profit, a positive signal from a financial stability standpoint. That said, since the source of net profit has varied each year, its sustainability requires confirmation through future results.

Strong Gross Margin

Seoul Pharma's gross margin of 60.4% ranks around 9th among listed pharmaceutical and bio companies, a relatively high level. This suggests the company's specialized ODF formulation technology generates comparatively high added value.

If this gross margin is maintained, there is room for operating margin improvement depending on SG&A efficiency gains.

Improved Cash Flow

Operating cash flow improved markedly to a positive KRW 1.89 billion in 2025 from negative KRW 3.01 billion in 2024. That cash generation turned positive despite an income-statement operating loss can be read as a sign of improvement in receivables collection or inventory and cost management.

Bear factors

Operating Profit Turned to a Loss

Operating profit swung to a loss of KRW 1.28 billion in 2025 from a gain of KRW 1.53 billion in 2024, breaking a three-year streak of operating profit from 2022 through 2024. Operating losses have continued in every one of the trailing four quarters, with no confirmed recovery in core business profitability.

Heavy SG&A Burden

The SG&A ratio stands at 62.9%, far exceeding the KOSDAQ-listed pharmaceutical average of 37.2%. Despite a healthy gross margin, SG&A consumes most of that profit, resulting in a recurring loss at the operating income line.

Net Profit Reliant on a One-Off Item

Of the KRW 1.74 billion in net profit accumulated over the trailing four quarters, the vast majority stemmed from the KRW 2.62 billion net profit in Q3 2025, with the remaining three quarters all posting net losses.

This concentration suggests net profit could deteriorate again if a similar non-operating factor fails to recur.

Risk factors

Export Contract Execution Risk

Seoul Pharma has a history in which a roughly KRW 111.1 billion China export contract for an ODF erectile dysfunction drug was cancelled six years after signing.

Recent overseas deals, such as the supply agreement with Taiwan's Centerlab, are relatively small in scale, leaving uncertainty over whether large contracts will recur and when actual revenue would be recognized.

Profitability Structure Risk

Because of a high SG&A ratio, the company has repeatedly posted operating losses despite strong gross profit. Without progress on SG&A efficiency, revenue recovery alone may offer limited improvement to operating profitability.

Balance Sheet Volatility Risk

The debt ratio fell to 64.2% in 2023 before rising again to 78.3% in 2024 and 74.8% in 2025. Given that operating cash flow has swung widely from year to year, the possibility of the balance sheet deteriorating again cannot be ruled out.

What to watch next

Mid-November 2026
Check the Q3 2026 quarterly report for whether operating profit turns positive and whether a one-off factor again influences net profit.
Around March 2027
Review the full-year 2026 annual report to reconfirm trends in the annual SG&A ratio, gross margin, and debt ratio.
Ongoing from Q4 2026
Should new supply or overseas export contracts related to ODF health supplements or CMO business be disclosed, verify the contract size and actual execution given the company's past track record.
At each quarterly earnings release
At each quarterly release, confirm whether new generic or improved drug launches such as peptic ulcer products shift the revenue mix, and whether the decline in obesity-drug sales continues.

Overall view

Seoul Pharma posted an operating loss in 2025, reflecting clear weakness in core business profitability, yet it displayed an unusual structure in which owner net profit stayed positive for a fourth straight year.

However, most of the net profit accumulated over the trailing four quarters depended on a one-off factor in Q3 2025, and excluding that quarter, results have shown continued operating and net losses.

Gross margin ranks in the upper tier among listed pharmaceutical companies, but an excessively high SG&A ratio prevents that from translating into operating profit — a structural challenge.

Expansion of ODF manufacturing, health-supplement and CMO business, and planned launches of improved chronic-disease drugs and first-generation generics could serve as seeds for future revenue diversification, but given the company's history of cancelled large export contracts, the feasibility of new deals warrants ongoing verification.

Year-to-year volatility in the debt ratio and cash flow should also be weighed in assessing financial stability. Before forming an investment view, it is worth monitoring whether a similar one-off factor recurs in coming quarters and whether progress is made on SG&A efficiency.

Sources

Korea Exchange (KRX) — Prices · Market Cap · Volume
FSS electronic disclosure system (DART) — Financial statements · Dividend filings

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Report written 2026-09-05 · Data as of 2026-09-04

This content is AI analysis of market data and web search results, provided for information only. It is not a solicitation or recommendation to invest. Investment decisions and their consequences are the investor's own responsibility. Data may be delayed or contain errors.