THE E&M: Consolidated Net Loss of 17.6 Billion Won in Q1 2026… Worsened Performance with Derivative Valuation Loss of 12.9 Billion Won

Consolidated Q1 2026: Revenue 6.2 billion won (vs 3.1 billion in Q1 2025), operating loss 2.1 billion won (vs 1.7 billion), net loss 17.6 billion won (vs 3.8 billion), widening losses.
Separate: Revenue 1.9 billion won (vs 2.3 billion), operating loss 1.9 billion won (vs 1.7 billion), net loss 16.4 billion won (vs 3.6 billion).
Derivative valuation loss of 12.9 billion won (consolidated and separate) drove surge in financial costs.
Debt ratios: consolidated 110.9%, separate 250.6% – high financial leverage persists.
After the report date (April–May 2026), additional convertible bonds issued (Series 22: 8.5 billion won, Series 23: 5.0 billion won, Series 24: 10.0 billion won totaling 23.5 billion won) and existing CB conversions increased share count.
Consolidated accumulated deficit 137.5 billion won, separate 141.7 billion won – severe capital erosion.
Designated as an unfaithful disclosure entity in 2025 and fined 3.5 penalty points.
Pending lawsuit against Seocho-gu Office over acquisition tax (1.07 billion won).

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