[At the Crossroads] Lithium Force ① No Lithium Performance... Years of Losses and Investment Write-Offs

Announced 20 Billion Won Investment, but Half of Funds Written Off

Lithium Business Plans Being Revised... Five Consecutive Years of Losses

Despite its name, Kosdaq-listed company Lithium Force has been found to have virtually no revenue from lithium-related businesses. In addition, it has been confirmed that about half of the several billions of won previously invested in its lithium operations have already been written off as a loss. Nevertheless, the stock price continues to fluctuate sharply in response to lithium-related news, drawing keen attention from investors.

According to the Financial Supervisory Service's electronic disclosure system on April 10, Lithium Force reported sales of 8 million won from its lithium business division last year. This accounted for only 0.1% of total sales, representing a negligible scale. The majority of Lithium Force's revenue came from its mobile phone accessories business division.

Lithium Force was established in 1998 under the name “From Thirty.” Its initial business focused on developing semiconductor inspection equipment. However, after merging with WithMobile, a content product manufacturing company, in 2019, it became a manufacturer of mobile accessories utilizing intellectual property (IP) such as Kakao Friends. Currently, the mobile accessories business accounts for 90% of its revenue.

In 2022, this company abruptly announced its entry into the lithium material anode powder business for secondary batteries and changed its name to Lithium Force. In April 2023, it purchased land within the Saemangeum National Industrial Complex, investing approximately 17 billion won to establish a lithium material manufacturing plant. At the time, the company held a groundbreaking ceremony and also revealed plans for an additional investment of 200 billion won.

Buoyed by such expectations, Lithium Force's share price soared. In September 2022, shares were trading at around 4,500 won, but by April 2023, they had surpassed 35,000 won—a rise of about 680% in just seven months. This surge is seen as a result of riding the wave of optimism surrounding the growth of the electric vehicle industry.

However, the current share price hovers around the 600-won level. The lack of tangible achievements over several years, coupled with internal strife such as management disputes, is seen as having undermined market trust.

In fact, Lithium Force has recorded its lithium-related investments as losses. As of the end of last year, Lithium Force recognized an impairment loss of 9.1 billion won on land and facility equipment for the Saemangeum plant and a bad debt expense of 1.1 billion won on loans. If construction is not completed by May and the schedule is delayed, the occupancy contract may be terminated. Lithium Force has already set aside about 600 million won as a provision for related restoration costs.

Despite the lack of revenue and only incurring losses, Lithium Force's stock price has continued to be volatile whenever lithium-related issues come into focus.

In its annual business report, Lithium Force stated, “External financing for the Saemangeum plant project has not proceeded smoothly, so we are revising our business plan,” and added, “As the likelihood of triggering a termination clause in the occupancy contract has increased, we recognized part of the assets under construction as impairment losses.”

Meanwhile, Lithium Force has also continued to struggle in its existing businesses. On a standalone basis, the company's revenue last year was 10.7 billion won, down 30% from the previous year. It recorded an operating loss of 4.5 billion won and a net loss of 13.4 billion won. The company has remained in the red for five consecutive years and was designated as an administrative issue stock last year.

This content was produced with the assistance of AI translation services.