[Edaily Reporter Park Jung-Soo ] #S&K POLYTEC CO., LTD. announced on the 19th that it held a board of directors meeting and decided to transfer retained earnings to the capital reserve to enhance shareholder returns and shareholder value. This proposal is scheduled to be approved at an extraordinary general meeting of shareholders on September 28.
This decision aims to secure distributable earnings for implementing shareholder return policies, such as cash dividends and share buybacks. Although distributable earnings are expected to be generated starting next year following the recognition of a large capital gain from the sale of an idle factory for 48 billion won last June, the company is taking this preemptive step to secure sufficient funds for shareholder returns. In particular, dividends paid through a reduction in the capital reserve can increase the effective dividend yield due to tax savings.
In conjunction with the merger with SUNJIN Co., Ltd., a company specializing in automotive electrical components, the company name will also be changed to S&K Global. As the business structure has changed following the absorption merger with SUNJIN Co., Ltd., the new name reflects the company’s commitment to encompassing all group business segments—including its subsidiary CAP—and its determination to expand into overseas markets.
SUNJIN Co., Ltd is a specialized automotive electronics parts manufacturer that produces busbars and terminals for electric vehicles (EVs). Leveraging its precision press-forming technology and quality control capabilities, the company has secured a stable volume of orders, and its revenue this year is expected to grow compared to the previous year.
An S&K POLYTEC CO., LTD. official stated, “Despite our sound financial structure, it has been difficult to implement shareholder return policies due to restrictions under the Commercial Act,” adding, “We decided to convert capital reserves into retained earnings through a reduction in capital reserves to secure funds for active shareholder returns—such as dividends and share buybacks—and to enhance corporate value.” The official further emphasized, “Taking the change of our company name and the merger with SUNJIN Co., Ltd. as an opportunity, we will move more actively to invest in business diversification and strengthening our growth engines.”