Hancom Office software sales in the third quarter are estimated to have increased 10 percent on-year to 18.5 billion won (US$16.30 million) with the release of Hancom Office NEO 2016, according to Shinhan Investment on Oct. 21.
Its subsidiary Itex, a PDF solution provider, is likely to have contributed 3.1 billion won to sales and helped drive top-line growth.
The firm’s operating profit is projected to have increased 8 percent on-year to 7 billion won. The SG&A cost-to-sales ratio is likely to drop to 60.6 percent from 61.2 percent in the second quarter, the securities firm said.
Sales and operating profit in 2016 will grow 17 percent and 8 percent on-year, to 99.7 billion won and W30.2billion won, respectively.
Top-line growth is expected as a result of the launch of the new product and contributions from Itex. However, operating profit growth will likely slow down due to rising marketing and R&D costs, the brokerage said.
For 2017, Shinhan Investment forecast sales of 108.4 billion won increasing 9 percent on-year and operating profit of 34 billion won, climbing up 13 percent on-year.
Provincial education offices are expected to select Hancom Office as their integrated office software following the decision of the Gyeonggi Provincial Office of Education. Growth momentum should pick up on entry into overseas markets with additional contracts. The operating profit margin should improve 1.1 percent on year to 31.4 percent as the SG&A cost-to-sales ratio will decline after rising for two years, it said.
by Yun Jeong-hyeon (email@example.com