1. What Happened? Q2 Earnings Breakdown

Korea Airport’s Q2 2025 revenue grew by 5.7% year-over-year to KRW 317.16 billion, exceeding market expectations. However, operating profit and net income fell short, indicating a decline in profitability.

2. Why Did This Happen? Analyzing the Results

The revenue growth is attributed to the strong performance of the ground handling business, driven by increased international flights. However, increased cost burdens or rising SG&A expenses likely contributed to the decline in profitability.

3. What’s Next for Korea Airport? Fundamentals and Outlook

  • Strengths: Robust core business (ground handling), strong financial position, strengthened ESG management, diversification into new businesses
  • Weaknesses: Profitability decline, dependence on related parties (Korean Air)
  • Opportunities: Recovery in air travel demand, growth potential of new businesses
  • Threats: Volatility in exchange rates and oil prices, intensifying competition, global economic slowdown

Korea Airport is expected to achieve steady growth based on its stable core business and financial structure. However, improving profitability, responding to external environmental changes, and the success of new businesses will be key variables affecting its future stock price.

4. What Should Investors Do? Action Plan

We maintain a ‘Neutral’ rating on Korea Airport. It is advisable to consider investment after analyzing additional information such as factors for improving profitability and the performance of new businesses. Careful monitoring of changes in cost structure and SG&A expenses is crucial.