Nsys Ends Battery Equipment Supply Contract Due to Gapjin Rehabilitation, Losing 3.6 Billion KRW in Revenue

This is a corrective disclosure reporting the termination of a previously announced single sale and supply contract due to the corporate rehabilitation of counterparty Gapjin Co., Ltd.
The contract amount has been adjusted from the original 5,996,138,500 KRW to a confirmed 2,398,455,400 KRW reflecting only the completed portion which represents 5.62% of 2021 revenue.
The termination results in a loss of expected future revenue of approximately 3.6 billion KRW equivalent to 6.48% of the company's market capitalization.
Counterparty Gapjin is currently under corporate rehabilitation proceedings approved by the Suwon Rehabilitation Court indicating a very high credit risk.
While Nsys has received a 40% advance payment the remaining 60% in milestone and final payments is unlikely to be collected negatively impacting profitability.
[AI Summary]The contract termination due to Gapjin's rehabilitation causes a revenue loss of about 3.6 billion KRW or 6.48% of market cap materializing counterparty risk and threatening profitability.