KOSDAQFood & Beverage270870

Newtree

₩3,600▲ 0.84%2026-10-02 close

Market Cap

₩32.8B

Turnover

₩14,546,980

Volume

4,061 shares

Shares out.

PER

7.4×

PBR

0.3×

EPS

₩522

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

Revenue Shows Signs of Recovery, Profitability Remains a Challenge

NewTree swung to an operating and net loss in 2025 as both revenue and operating profit deteriorated, but in 2026 revenue has grown for two consecutive quarters even as operating profit has stayed near breakeven.

1
2025 revenue came to KRW 101.1bn (down year on year), with an operating loss of about KRW 2.3bn marking a swing to loss
2
In Q4 2025 the company posted an operating loss of roughly KRW 3.8bn and a net loss of about KRW 4.3bn, the largest quarterly loss in the recent five-quarter window
3
Revenue rose sequentially to KRW 25.9bn in Q1 2026 and KRW 28.4bn in Q2 2026, but operating profit stayed roughly at breakeven in both quarters
4
Q2 2026 net income attributable to owners jumped to about KRW 7.7bn, far exceeding the roughly KRW 7 million operating profit, suggesting a large non-operating item
5
The company is pursuing 12 new functional ingredients with a KRW 10bn R&D investment by 2028, alongside a two-track export strategy covering Southeast Asia and the US/Europe

Business structure

NewTree Co., Ltd. (KOSDAQ: 270870), established in 2001 and listed on KOSDAQ in 2018, is a health-functional-food specialist that manufactures, sells, and exports/imports food and food additives, developing and distributing natural-origin inner-beauty health functional ingredients and finished products.

Its product lines span four categories -- skin health, diet, core food, and functional foods -- sold through home shopping, telemarketing, online, and offline B2C channels.

Its flagship brand, EverCollagen, has built substantial brand equity in the domestic inner-beauty collagen market, and the company aims to leverage functionality data spanning skin, joint, hair, and bone health to expand into ingredient sales.

GS Retail, a longtime home-shopping partner, holds a 6.04% stake in NewTree, but the relationship has been shifting as the company has spent the past three years reducing its reliance on the home-shopping channel in favor of online and offline sales to improve profitability.

The company is pursuing a plan to invest a total of KRW 10 billion in R&D by 2028 to secure 12 new functional ingredients, including collagen, fingerroot extract, GABA, ginseng berry extract, and Ginolacto.

Its export strategy follows a two-track approach: finished products targeting Southeast Asia (including the Watson retail channel) and raw ingredients targeting advanced markets such as the US, Europe, and Japan.

In Vietnam, the company says it has built vertical integration from fish farming through gelatin and collagen production to secure cost competitiveness.

Expanding both finished-product exports in inner beauty and ingredient exports such as collagen peptide simultaneously is presented as the company's core growth strategy.

Earnings trend

Quarterly revenue · Operating profit

₩25.5B₩200M25Q2₩25.4B₩500M25Q3₩24.5B-₩3.8B25Q4₩25.9B-₩26,131,90826Q1₩28.4B₩6,969,94926Q2

RevenueOperating profit

Annual revenue · Operating profit

₩198.6B₩4.5B2022₩151.4B₩10.5B2023₩122B₩4.9B2024₩101.1B-₩2.3B2025

RevenueOperating profit

Quarterly results · Last 5 quarters
Quarter	Revenue	Operating profit	Op. margin
2025Q2	₩25.5B	₩200M	0.8%
2025Q3	₩25.4B	₩500M	2.0%
2025Q4	₩24.5B	-₩3.8B	−15.4%
2026Q1	₩25.9B	-₩26,131,908	−0.1%
2026Q2	₩28.4B	₩6,969,949	0.0%

Annual results
Year	Revenue	Operating profit	Net income (parent)	Op. margin	ROE	Debt-to-equity
2022	₩198.6B	₩4.5B	₩4.7B	2.3%	4.9%	48.5%
2023	₩151.4B	₩10.5B	₩4.6B	7.0%	4.6%	31.0%
2024	₩122B	₩4.9B	₩4.8B	4.0%	4.5%	28.8%
2025	₩101.1B	-₩2.3B	-₩2.4B	−2.2%	−2.3%	30.0%

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

Based on confirmed figures, NewTree's revenue declined for four consecutive years, from KRW 198.6bn in 2022 to KRW 151.4bn in 2023, KRW 122.0bn in 2024, and KRW 101.1bn in 2025.

Operating profit improved to KRW 10.5bn (7.0% margin) in 2023 before falling to KRW 4.9bn (4.0%) in 2024 and swinging to a loss of KRW 2.3bn (-2.2%) in 2025.

Net income attributable to owners followed a similar path, staying around KRW 4.6bn in 2023 and KRW 4.8bn in 2024 before turning to a loss of about KRW 2.4bn in 2025.

The company attributed the deterioration to revenue declines amid intensifying competition in the inner-beauty market, along with increased clinical investment, new-product development, and proactive marketing spending during a brand-portfolio realignment, plus higher development and marketing costs tied to new-business (ingredients and cosmetics) and overseas expansion.

By quarter, revenue and operating profit improved modestly from KRW 25.5bn/KRW 0.2bn in Q2 2025 to KRW 25.4bn/KRW 0.5bn in Q3 2025, but Q4 2025 saw revenue of KRW 24.5bn alongside an operating loss of about KRW 3.8bn and a net loss of about KRW 4.3bn -- the largest quarterly loss in the recent window and the main driver of the full-year deterioration.

In 2026, revenue rose for two straight quarters to KRW 25.9bn in Q1 and KRW 28.4bn in Q2, but operating profit remained near breakeven at roughly -KRW 26 million in Q1 and KRW 7 million in Q2.

Net income attributable to owners, however, jumped from about KRW 219 million in Q1 to roughly KRW 7.7bn in Q2, a figure far exceeding the operating profit for the same quarter, pointing to a likely one-off non-operating item whose specific nature requires further confirmation through disclosure footnotes.

As a result, over the trailing four quarters (Q3 2025 through Q2 2026) operating profit remained in loss territory even as net income attributable to owners turned positive.

Industry analysis

Korea's health-functional-food market has seen intensifying competition as large conglomerates continue to enter and diversify distribution channels.

One brokerage report identified intensifying competition in the health-functional-food market as a key risk for NewTree, noting that industry-wide consolidation resembling a price war was underway even as large companies kept entering the market.

Amid this backdrop, NewTree has sought differentiation by securing individually-recognized functional ingredients from Korea's Ministry of Food and Drug Safety, such as low-molecular collagen peptide and fingerroot extract, which carry a period of exclusive status.

The company's historically heavy reliance on the home-shopping channel weighed on profitability as channel efficiency declined; sales commissions GS Retail earned from NewTree fell from KRW 36bn in 2021 to KRW 22.6bn in 2023, reflecting a broader contraction in the home-shopping channel.

Overseas, expansion through Southeast Asian health-and-beauty retail networks such as Watson has emerged as an alternative growth avenue for the inner-beauty segment, with distribution expanding from Malaysia into Hong Kong, China, and other markets following the initial Watson listing.

Still, the domestic inner-beauty market centered on collagen faces structurally intensified competition as major cosmetics and food conglomerates enter in force, leaving individual companies with the ongoing challenge of defending market position.

Outlook

NewTree has laid out a roadmap to invest a total of KRW 10 billion in R&D by 2028 to secure 12 new functional ingredients, saying it plans to actively pursue equity investments and M&A in addition to in-house research to build ingredient leadership.

Finished-product exports are focused on expanding the Watson retail network across Southeast Asia; following its Malaysia launch, the company has expanded into Singapore, Hong Kong, and China, and is also pursuing direct dealings with Thailand's leading distributor.

The company said it is also considering entry into Vietnam and Indonesia, aiming for visible results within two to three years through local store placements and influencer marketing.

On the ingredient side, the company is expanding collagen peptide sales toward advanced markets including Japan, the United States, and Europe.

However, these new ingredient commercialization and overseas expansion strategies are still at an early stage without a clearly quantified revenue contribution, so the extent to which they are reflected in 2026 results will need to be monitored through future disclosures.

While revenue growth for two consecutive quarters in the first half of 2026 is a positive sign, operating profit has stayed near breakeven, indicating that profitability recovery has yet to catch up with the pace of revenue recovery.

Valuation

PER

7.4×

PBR

0.3×

ROE

4.5%

EPS

₩522

BPS

₩11,761

Dividend per share

₩0

One brokerage's January 2023 report, reflecting expected earnings improvement at the time, presented an estimated PER of 8.2x and PBR of 0.9x, noting that the PBR was approaching a historical low of around 0.7x.

Compared with that historical band, the current share price trades at a relatively modest multiple of net asset value per share, which can be read as the market waiting to see whether profitability recovers following the 2025 swing to loss.

No dividend payments have been identified in recent fiscal years, suggesting the company is prioritizing capital allocation toward new ingredient development and overseas channel expansion over shareholder returns.

Over the trailing four quarters (Q3 2025 through Q2 2026), operating profit remained in loss territory while net income attributable to owners turned positive, a pattern driven more by non-operating items than by an improvement in core operations, which warrants caution when interpreting the financial metrics.

The coexistence of two consecutive quarters of revenue growth with operating profit still near breakeven means the durability of any earnings improvement will need to be confirmed through subsequent quarterly results.

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

Overseas channel diversification

Finished products are expanding through the Watson retail network in Southeast Asia, moving from Malaysia into Singapore, Hong Kong, and China, while direct dealings with Thailand's leading distributor are also underway.

Amid intensifying domestic inner-beauty competition, overseas channel expansion can serve as an avenue to broaden the revenue base. Entry into Vietnam and Indonesia is also under consideration, offering room to expand the sales footprint over the medium term.

Cost-competitiveness strategy

The company says it has built vertical integration in Vietnam, from fish farming through gelatin and collagen production.

This is intended to secure cost competitiveness and support a strategy of targeting advanced markets -- where bovine- and porcine-derived collagen dominate -- by differentiating with fish-derived collagen.

A parallel R&D investment plan for new ingredients is also under way, which could strengthen medium-term material competitiveness.

Signs of revenue rebound in 2026

Revenue rose for two consecutive quarters in 2026, reaching KRW 25.9bn in Q1 and KRW 28.4bn in Q2, marking a shift in direction from the 2025 downtrend. The rebound after quarters of decline suggests channel realignment efforts may be starting to show some effect.

Whether this translates into an improved operating margin, however, needs to be confirmed in subsequent quarterly results.

Bear factors

Revenue decline for three straight years culminating in a loss

Revenue declined for four consecutive years, from KRW 198.6bn in 2022 to KRW 101.1bn in 2025, and in 2025 both operating profit and net income swung to losses. The company cited intensifying competition in the inner-beauty market as the main driver of the revenue decline.

With the revenue base continuing to shrink, overlapping marketing and R&D cost burdens have delayed a recovery in profitability.

Operating profit near breakeven for five straight quarters

From Q2 2025 through Q2 2026 -- five consecutive quarters -- operating profit stayed at roughly 1% of revenue or turned negative. Q4 2025 in particular saw an operating loss of about KRW 3.8bn, the largest quarterly loss in the recent window.

Even as revenue grew in 2026, operating profit failed to move meaningfully beyond breakeven, indicating that the core business's profit-generating capacity has not yet recovered.

Home-shopping channel contraction and shifting GS Retail relationship

Sales commissions GS Retail earned from NewTree fell from KRW 36bn in 2021 to KRW 22.6bn in 2023, reflecting a broader contraction in the home-shopping channel.

As the company has continued a strategy of reducing home-shopping reliance to improve profitability, some shrinkage of a previously core revenue source has been unavoidable.

GS Retail remains a major shareholder holding a 6.04% stake, and how the channel strategy shift affects that equity relationship is worth monitoring.

Risk factors

Earnings volatility

When net income far exceeds operating profit, as occurred in Q2 2026, failing to accurately identify the nature of the non-operating item can lead to a misreading of the earnings trend. If gaps between operating profit and net income recur, assessing the quality of quarterly results becomes more difficult. Detailed confirmation through future disclosure footnotes is needed.

Competitive intensity risk

There have been assessments that price and marketing competition in the health-functional-food and inner-beauty markets has structurally intensified as large conglomerates continue to enter.

The exclusive status granted to individually-recognized ingredients is also time-limited, so if competitors develop similar ingredients or obtain their own approvals, NewTree's differentiation could weaken. This could weigh on the durability of any revenue and margin recovery.

Execution risk in overseas expansion and new business

Expansion of the Southeast Asian Watson channel, entry into Vietnam and Indonesia, and the plan to secure 12 new ingredients by 2028 are still at the planning or early execution stage, and certification/regulatory compliance and local marketing costs could turn out larger than expected.

If the targeted results fail to materialize within the intended two-to-three-year window, the timeline for returns on this investment could be delayed. Plans to secure ingredients via equity investment or M&A also carry execution uncertainty.

What to watch next

Mid-November 2026 (around the Q3 report filing)
Check whether the Q3 2026 revenue growth trend continues and whether operating profit moves meaningfully beyond breakeven.
Upon filing of the next semiannual/Q3 report
Confirm through financial statement footnotes the specific nature of the non-operating item that drove the sharp Q2 2026 jump in net income attributable to owners (e.g., asset disposal, equity-method gains).
Second half of 2026
Monitor progress on commercializing new functional ingredients (such as GABA and ginseng berry extract) against the 2028 target of securing 12 new ingredients.
Fourth quarter of 2026
Watch for additional disclosures or reports on the expansion of Watson store listings in Southeast Asia and potential entry into Vietnam and Indonesia.

Overall view

NewTree saw revenue decline for four consecutive years from 2022 through 2025, culminating in a swing to both operating and net losses in 2025.

Revenue showed signs of recovery for two consecutive quarters in 2026, but operating profit has remained near breakeven, making it premature to conclude that the revenue recovery has translated into a profitability recovery.

Net income attributable to owners rose sharply in Q2 2026, but by a magnitude far exceeding the operating profit for the same quarter, pointing to a non-operating driver whose specific nature will need to be confirmed through further disclosure.

The company has laid out securing 12 new functional ingredients and a two-track export strategy spanning Southeast Asia and the US/Europe as its medium-term growth pillars, though these remain at the planning or early-execution stage.

The strategy of reducing reliance on the home-shopping channel is positive from a channel-efficiency standpoint but has come with a reduction in a previously core revenue source, and competitive intensity in the domestic inner-beauty market appears to be a structurally persistent challenge.

Ultimately, whether operating margin shows a substantive improvement and how visibly the overseas and new-business initiatives bear fruit in coming quarters will be the key variables to watch for the earnings trajectory ahead.

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.