Korea Electric Wire's consolidated operating profit for the second quarter of 2026 more than doubled compared to the same period last year, continuing the trend of improving core business performance. However, as the valuation loss on embedded derivatives of convertible bonds (CB) and losses on currency forward contracts were reflected, a derivative loss of KRW 173.3 billion was also disclosed.

According to a disclosure on the 30th, Korea Electric Wire's Q2 consolidated revenue was KRW 1.198667 trillion, up 30.81% from the same period a year ago. Operating profit for the same period was KRW 60.842 billion, up 113.01%. Compared to the previous quarter (Q1), revenue and operating profit increased by 10.64% and 0.71%, respectively.

On a cumulative first-half basis, revenue was KRW 2.2820290 trillion and operating profit was KRW 121.2530 billion. These figures represent increases of 28.80% and 117.82%, respectively, compared to the first half of last year.

■ Derivative Loss of KRW 173.3 Billion Incurred… "Does Not Involve Cash Outflow"

In a separate disclosure on the same day, Korea Electric Wire announced that it incurred a derivative loss of KRW 173,347,394,007. This is equivalent to 10.62% of the consolidated equity capital of KRW 1.632342790 trillion as of the end of last year.

The company cited two main reasons for the loss. First, it was the valuation loss on embedded derivatives of the 153rd private placement convertible bond (CB). The conversion rights for this CB were exercised on April 21 this year, resulting in a full conversion into shares, and an accounting valuation loss occurred during the process of measuring the embedded derivative at fair value in accordance with K-IFRS. The company explained that this loss does not involve an actual cash outflow.

Second, a loss arose from currency forward contracts, which were entered into to hedge against exchange rate fluctuation risks, due to a sharp rise in exchange rates.

Looking at the details of derivative gains and losses for the first half of 2026, transaction gains were KRW 257.55 million, valuation gains were KRW 4.09272 billion, transaction losses were KRW 6.17030 billion, and valuation losses were KRW 171.52736 billion, resulting in a net loss of KRW 173,347,394,007 when combined. The company added that the valuation loss does not have a direct impact on its operating environment or cash flow.