Classys (214150.KQ), an aesthetic medical device company, posted an operating margin in the 40% range, driven by the consolidation of its Brazilian subsidiary.
Classys reported preliminary first-quarter revenue of 87.2 billion won and operating profit of 37.2 billion won on a consolidated basis, the company said in a regulatory filing Wednesday. Revenue rose 13% from a year earlier, while operating profit declined 4.1%.
The revenue growth reflects the consolidation of MedSystems, a Brazilian aesthetic medical device distributor that Classys recently acquired. MedSystems was included in the consolidated results starting in March, and as the consolidation period was less than a month, its revenue contribution amounted to approximately 3.9 billion won.
However, a temporary accounting impact reduced gross profit by about 3 billion won, as inventory sold by the headquarters to the Brazilian entity was eliminated as unrealized profit on a consolidated basis. As a result, first-quarter operating profit came in at 37.2 billion won, down 4.1% year-on-year.
"This is a one-off factor that appears in the first consolidation process immediately following a business combination," a Classys official said. "Starting from the second quarter, sales to local clinics will be recognized as full-fledged earnings, and we expect both consolidated revenue and profit contributions to expand."
Growth drivers by product and region are also broadening. QuadSays, a new product, has been successfully launched in the United States and Thailand following its Korean rollout. In Europe, revenue growth is continuing as Ultraformer and Volnewmer gain traction in major markets. In China, the company is pursuing regulatory approval for Volnewmer within this year.
"The first quarter was a starting point for confirming our annual growth trajectory, and from the second quarter we expect earnings to take a step up as the South American consolidation effect combines with expanded sales in key markets," the Classys official said. "With multiple momentum factors — including the transition to direct operations in Brazil, European growth, orders from major clinic chains in Japan, and Chinese regulatory approval — materializing in sequence, we have strong confidence in achieving our 2026 guidance."
