PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q1–2025Q4) · Dividend yield is based on ₩0 per share · Prices as of the 2026-10-02 close
Kyungnam Pharm returned to operating profit in Q1 2026 but slipped back into loss in Q2, with signs of Lemona sales recovery coexisting with new ventures into pet care and liquor businesses.
2025 consolidated revenue was KRW 55.9 billion with an operating loss of KRW 1.7 billion, marking a fourth consecutive year of operating losses.
Sales of the core Lemona brand fell for three straight years, from KRW 20.1 billion in 2022 to KRW 14.4 billion in 2025.
Revenue and operating profit improved in Q1 2026, but operating profit reverted to a loss in Q2.
The company is simultaneously pursuing a KRW 19 billion rights offering and new business entries into pet care and liquor.
The CEO has changed seven times over the past decade, sustaining market concerns about governance stability.
Kyungnam Pharm, founded in 1957 and listed on KOSDAQ, operates through two business divisions: pharmaceuticals and Health & Beauty (H&B). In 2025, revenue was composed of 41.8% over-the-counter drugs, 26.2% general food products, 18.6% health functional foods, and 11.5% quasi-drugs.
Its flagship vitamin C brand 'Lemona,' launched in 1983, marks its 43rd anniversary this year and has won the domestic vitamin category brand award for 21 consecutive years.
However, Lemona powder sales peaked at KRW 20.1 billion in 2022 and have declined for three straight years to KRW 14.4 billion last year, with its share of total revenue shrinking from 34% in 2022 to 25.7%.
Distribution runs through roughly 24,000 pharmacies nationwide along with convenience stores, hypermarkets, and H&B store channels. The company has added pet supplies/feed and liquor import-export/distribution businesses to its corporate purpose in a bid to diversify growth drivers.
Its governance structure follows a multi-tier chain from Stella PE to Miraeing to K Biolabs to Incon to Humasis to Billions to Kyungnam Pharm.
The CEO position has changed seven times over the past decade, and the company shifted to a sole-CEO structure under Kim Sung-gon following its annual general meeting this past March.
| Quarter | Revenue | Operating profit | Op. margin |
|---|---|---|---|
| 2025Q2 | — | — | — |
| 2025Q3 | ₩14.2B | -₩1.1B | −7.5% |
| 2025Q4 | ₩14.7B | ₩66,261,703 | 0.5% |
| 2026Q1 | ₩16.1B | ₩400M | 2.3% |
| 2026Q2 | ₩17.8B | -₩200M | −1.2% |
| Year | Revenue | Operating profit | Net income (parent) | Op. margin | ROE | Debt-to-equity |
|---|---|---|---|---|---|---|
| 2022 | ₩59B | -₩3.4B | -₩6.8B | −5.7% | −6.8% | 44.7% |
| 2023 | ₩68.4B | -₩6.7B | -₩21B | −9.9% | −26.5% | 85.5% |
| 2024 | ₩60.8B | -₩900M | ₩10.1B | −1.6% | 8.7% | 44.6% |
| 2025 | ₩55.9B | -₩1.7B | -₩9B | −3.1% | −8.3% | 43.7% |
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 rose from KRW 59.0 billion in 2022 to KRW 68.5 billion in 2023, then declined for two straight years to KRW 60.8 billion in 2024 and KRW 55.9 billion in 2025.
Operating loss widened from KRW 3.4 billion in 2022 to KRW 6.7 billion in 2023, before narrowing to KRW 0.9 billion in 2024 and widening again to KRW 1.7 billion in 2025, extending operating losses to a fourth consecutive year.
Net income attributable to owners swung from a large loss of KRW 6.8 billion in 2022 and KRW 21.0 billion in 2023 to a profit of KRW 10.1 billion in 2024, though much of that gain stemmed from one-off proceeds tied to the disposal of an affiliate stake rather than core business recovery.
In 2025, the company reverted to a net loss of KRW 9.0 billion, driven by impairment losses on investment property and valuation losses on financial assets.
Operating cash flow improved from KRW 0.07 billion in 2022 to KRW 0.69 billion in 2023 and KRW 1.84 billion in 2024, before turning negative again at KRW -1.68 billion in 2025.
On a quarterly basis, Q3 2025 revenue was KRW 14.16 billion with an operating loss of KRW 1.06 billion, before turning to an operating profit of KRW 66 million on revenue of KRW 14.65 billion in Q4.
Q1 2026 revenue reached KRW 16.13 billion with operating profit of KRW 0.38 billion, though owners' net loss was KRW 0.70 billion, and in Q2 2026 revenue grew to KRW 17.81 billion even as operating profit reverted to a loss of KRW 0.21 billion and the owners' net loss widened to KRW 3.12 billion.
Korea's vitamin and health functional food market has structural growth drivers from population aging and rising health management demand, but competition has intensified as numerous pharmaceutical and food companies roll out similar products.
Analysts attribute part of Kyungnam Pharm's sales weakness to a pharmacy-centered offline distribution structure that failed to adapt in time to shifting consumption trends.
As consumption shifts toward online channels and convenience/H&B stores, Kyungnam Pharm has reportedly driven some recent improvement in revenue and operating profit through online sales activation.
Rival companies leverage stronger brand power and distribution networks in the vitamin and inner-beauty categories, making it difficult for even a long-standing brand like Lemona to defend sales without new products and channel expansion.
The company's new drug R&D pipeline is effectively stalled, and it is seeking growth drivers through extending existing brands and entering new categories such as pet care and liquor.
This mirrors a broader industry trend of established pharmaceutical firms expanding into consumer goods and distribution as their core pharmaceutical business stagnates.
The company has stated that Lemona powder sales reached approximately KRW 8.4 billion and PM product sales about KRW 1.3 billion in the first half of this year, indicating a recovery trend in some key brands.
It is simultaneously realigning distribution channels, expanding advertising and promotions, and launching new products leveraging existing brands, with plans to strategically cultivate products such as Jahasaengryeok in OTC and the Kalo series in the H&B category.
In May, the company added pet supplies/feed and liquor import-export/distribution to its business purpose at an extraordinary general meeting, and around the same time disclosed a rights offering of KRW 19.085 billion issuing 11 million new shares, with the new shares slated to list on August 24.
However, the liquor business has relatively weak connection to its existing operations, and its actual execution and investment scale remain a variable to watch. The company said it plans to continue reviewing new business opportunities going forward.
Building on Lemona's 21st consecutive brand award, the company continues its strategy of extending brand equity across a wider range of products and consumer segments.
The price-to-book ratio trades at a notable discount to net asset value, which stands in contrast to owners' equity that generally ranged between roughly KRW 90 billion and KRW 115 billion between 2023 and 2025. Dividend appeal is limited given the absence of payouts in recent years.
Net income has swung significantly—from a large loss in 2023, to a one-off-driven profit in 2024, back to a net loss in 2025—making simple earnings-multiple valuation difficult to apply in this stretch.
With the recent reverse stock split and rights offering simultaneously altering both share count and capital structure, comparing against historical trading bands may be less informative than tracking upcoming quarterly results to gauge whether the core business is genuinely recovering.
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
According to company disclosures, Lemona powder sales reached about KRW 8.4 billion in the first half of this year, showing signs of partially offsetting three straight years of decline. Winning the brand award for a 21st consecutive year demonstrates that 43 years of accumulated brand recognition remains intact.
The company also attributes recent improvement in revenue and operating profit partly to online channel activation.
Q1 2026 revenue reached KRW 16.13 billion with operating profit of KRW 0.38 billion, an improvement from the prior-year period. This is interpreted as partly reflecting efforts to manage receivables/inventory and reduce selling and administrative expenses. However, net income remained in loss, so it may be premature to call this a full normalization.
The company is expanding into pet care business, which can leverage existing health functional food and distribution capabilities, as well as liquor distribution. It secured funding for new business and working capital through a KRW 19 billion rights offering.
While success remains uncertain, this can be viewed as an attempt to break through stagnation in its core business.
The company has recorded operating losses every year from 2022 to 2025, with the 2025 operating loss widening to KRW 1.7 billion from the prior year. Operating profit reverted to a loss again in Q2 2026, indicating that a profitable trend has not been sustained. Analysts note that the core business's earnings power has yet to be confirmed.
Sales of the core Lemona brand fell for three consecutive years from KRW 20.1 billion in 2022 to KRW 14.4 billion in 2025, and its share of total revenue dropped from 34% to 25.7%. Analysts also point to an offline-distribution-centered structure that failed to adapt to shifting consumption trends.
Flagship OTC and health functional food products cited as alternative growth drivers have also seen sales declines.
The CEO has changed seven times over the past decade, and the controlling shareholder structure runs through multiple special-purpose entities.
A large rights offering followed shortly after the announcement of a liquor business unrelated to its core operations, leading to mixed interpretations in the market about whether the move was aimed at supporting the share price.
A similar diversification attempt at an affiliated company was previously discontinued, leaving questions about execution capability.
Operating profit has alternated between gains and losses on a quarterly basis, making it difficult to confirm a definitive trend of improvement.
Net income has been heavily influenced by non-operating factors such as investment property impairment and financial asset valuation losses, and similar one-off items could recur going forward.
Operating cash flow reportedly turned negative again in 2025, and cash and cash equivalents also fell sharply. The company's repeated reliance on rights offerings for funding could lead to dilution burdens for existing shareholders.
The pet care and liquor businesses are still at the articles-of-incorporation amendment stage, with actual investment scale and commercialization timing yet to be determined.
Industry observers note that the liquor business in particular has low relevance to the existing pharmaceutical and health functional food operations, making its prospects for success difficult to assess.
The Q3 2026 quarterly report disclosure should be checked to see whether the Lemona sales recovery and operating profit trend continue.
The actual float and dilution impact of the rights-offering new shares, which were slated to list on August 24, should be monitored.
Whether actual capital execution and early revenue contribution from the new pet care and liquor businesses become visible should be confirmed.
The 2026 annual business report and external auditor's opinion should be checked to confirm finalized annual results and changes in financial soundness indicators.
Kyungnam Pharm posted 2025 revenue of KRW 55.9 billion and an operating loss of KRW 1.7 billion, marking a fourth consecutive year of losses, though revenue and operating profit improved into a profit in Q1 2026 before reverting to a loss in Q2, reflecting repeated swings in performance.
Its core Lemona brand has maintained brand strength by winning the brand award for a 21st consecutive year, but actual sales declined for three straight years since 2022, with some signs of recovery reported in the first half of this year.
The company is seeking growth drivers through a KRW 19 billion rights offering and entry into pet care and liquor businesses, though market assessments of their relevance to existing operations and execution capability remain mixed.
Seven CEO changes over the past decade and a multi-tier governance structure continue to draw attention regarding management stability. Given that net income has been heavily influenced by one-off factors, more time appears needed before sustained earnings power in the core business can be confirmed.
It is important to monitor upcoming quarterly results alongside the actual progress of new businesses before forming any investment judgment.
Report written 2026-09-05 · Data as of 2026-09-04
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