Korea Zinc is extending its record-breaking earnings streak by cementing a hard-to-replace position in the critical minerals supply chain. Analysts say the results reflect not a one-off performance but a structural increase in the company's earnings power.
According to industry sources on the 11th, Korea Zinc posted first-quarter revenue of 6.072 trillion won and operating profit of 746.1 billion won. Revenue rose 58.4% and operating profit surged 175.2% from a year earlier, with both figures marking record highs on a quarterly basis. The company also extended its streak of quarterly profits to 105 consecutive quarters.
These results are seen as stemming not only from its smelting business but also from stable earnings in rare metals such as antimony, which are essential to advanced and defense industries. Korea Zinc produces more than 10 types of metals, ranging from base metals such as zinc, lead and copper to precious metals such as silver and gold, and rare metals including antimony, indium, bismuth and tellurium.
In particular, according to the company, Korea Zinc is the only domestic firm that produces antimony and indium. This is why its technological capability to extract various critical minerals from secondary raw materials such as smelting byproducts and electronic scrap is regarded as its core competitiveness. Because it can recover metals to the maximum extent not only from concentrates but also from byproducts and waste, the company is credited with securing both profitability and environmental performance.
Recently, as China's export controls and expanded investment in advanced IT and defense industries have simultaneously driven up demand and prices for critical minerals, Korea Zinc's business competitiveness and market value have grown as well. The U.S. government's decision late last year to invest about 10 trillion won to jointly build a U.S. integrated smelter worth a total of 11 trillion won with Korea Zinc is interpreted as reflecting a judgment that such recovery technology is necessary to secure a stable supply chain.
Once Project Crucible is completed, Korea Zinc is expected to produce 12 types of non-ferrous metals, including 11 critical minerals, along with sulfuric acid for semiconductors on-site, positioning itself as a company with a North American supply chain base. Choi Yoon-birm, chairman of Korea Zinc, recently told new employees, "The United States is a market where new growth opportunities can be created across many areas, including the critical minerals supply chain, resource circulation, energy and logistics." He added, "Project Crucible is a key driver that will lead Korea Zinc's greater leap forward."
Analysts are also positive. In a report at the end of last month, Hanwha Investment & Securities named Korea Zinc as its top pick within the non-ferrous metals value chain, describing it as "a company where the competitiveness of recovering more metals from the same concentrate is captured as structural profit in the form of byproducts and rare metals, on top of which a U.S. supply chain base is being added."
It continued, "Korea Zinc's earnings are shifting their center of gravity from one-off to structural profit," and analyzed that "since a significant portion of recovered metals are critical minerals, the rarity of a non-Chinese recovery platform becomes more prominent as China's export controls become routine." Hanwha Investment & Securities forecast Korea Zinc's annual revenue this year at about 24 trillion won and operating profit in the 2.5 trillion won range.
Samsung Securities and Meritz Securities also projected that Korea Zinc will surpass 20 trillion won in annual revenue and 2 trillion won in operating profit for the first time ever this year. Samsung Securities said, "Following the U.S.-Iran war, volatility in precious metals prices has been high, so second-quarter results may decline from the previous quarter," but added, "Overall performance will maintain the elevated level seen since the second half of last year for the time being."
Meritz Securities pointed to stable profitability based on technological capabilities superior to competitors as a strength. Meritz Securities said, "Consolidated operating profit for the second quarter this year is expected to reach 563.6 billion won, in line with market expectations," explaining that "although the pace of increase in gold and silver prices slowed, zinc prices and a strong won-dollar exchange rate offset this." It also cited the stabilization of earnings at its subsidiaries SMC and Pedal Point as a positive factor.
