Korea Minting, Security Printing & ID Card Operating Corp. (KOMSCO), a sole state-run currency manufacturer of Korea, has made significant progress in its pursuit of overseas markets. On September 11, 2017, the company announced that it has won a noteworthy contract to manufacture 370 million coins (5 & 10 baht) for Thailand, a deal worth 32 billion won. “This is our single largest export so far,” said Kim Hwa-dong, CEO of KOMSCO.
Under the contract, the company will manufacture and supply 370 millions of baht coins by October 2018. In 2014, the company also produced 5 baht coins for Thailand. “We have elbowed out strong European and Asian competitors in an international bidding held in July this year,” said CEO Kim. “Our commitment to cutting production costs, along with our consistent efforts to explore overseas markets, have enabled us to win the contract,” said CEO Kim. “Winning the right to produce Thai coins will also greatly benefit our coins manufacturing business, which has been facing difficulties due to the expansion of uses of credit cards and mobile payments,” he added.
To cope with declining domestic sales, KOMSCO has been striving to expand its presence in overseas markets. Since the first export in 1970, KOMSCO has been supplying coins, banknotes, banknote papers, special inks, national identification cards and passports to more than 40 countries. Nowadays, the company is seeking to diversify export markets and products, including the security inks, electronic ID cards and high value-added banknotes and related technologies.
In addition to banknotes, KOMSCO also manufactures and exports premium quality cotton pulp for banknotes and security papers for banks, e-passports, machine-readable passports, e-ID cards, special anti-counterfeiting inks and chipsets for e-residential residence cards Its major function is to manufacture and supply a wide variety of security items, such as banknotes, coins, checks, national ID cards, passports, national and public bonds, various securities, medals and stamps. It also manufactures security papers required for printed materials.
KOMSCO is extending a helping hand to Korean exporters who are troubled by the flooding of fake products with the supply of anti-counterfeiting package papers and product authentication labels.
KOMSCO, which marked its 66 anniversary on October 1, is rapidly transforming into a global integrated minting and security solutions provider from a simple banknote manufacturer. This achievement was mainly attributable to three years of consistent efforts for management innovation and focus on new business. Despite the transition to a “coinless society” and reductions of banknotes and coins, KOMSCO is most likely to record the best performances in terms of sales revenues and net income for four consecutive years.
KOMSCO saw its sales increase for the past three years, totaling 427.6 billion won in 2014, 459.5 billion wib in 2015 and 463.3 billion won in 2016. Sales surged by 110 billion won in a four-year period, up from 351.5 billion in 2012. Operating incomes climbed every year, rising to 5.9 billion won in 2016 from 4.2 billion won in 2014. The debt ratio, as a result, was lowered to 17.8% last year from 23.3% in 2013. “We realized no-borrowing management,” declared CEO Kim of KOMSCO
He said that sales are expected to jump by over 15 billion won this year, compared to the previous year, while net income also will show noteworthy results. These results can be attributable to the company’s stepped-up efforts to promote its new business, while the currency business has been slumping. The new business, totaling 170 billion won in revenues, accounted for as much as 36% of total revenue in 2016, while the portion of currency manufacturing dwindled to 36.6% from 62% in 2007.
The new business, which KOMSCO had worked hard to promote for the past three years include commemorative and precious medals, product authentication, ID cards and overseas markets. Of note, the company established Global KOMSCO Daewoo LLC(GKD) on September 13, 2010, as a cotton pulp manufacturing company in Uzbekistan.
As for medal business, it was of small-scale in 2014. However, its revenue spiked to 47.1 billion won last year. By 2022, the company is hoping to earn 100 billion won from its medal business, based on its competitive strengths in manufacturing coins.
With the advent of the fourth industrial revolution, KOMSCO is striving hard to develop public sector authentication technology using block chains, security technology designed to prevent the hacking of smart meters and technologies related to things of Internet and CCTVs.
The company’s Technology Research Institute, which employs 75 superior researchers, marks 50th anniversary this year. It has an anti-counterfeit center and four research teams which perform investigation projects such as design & engraving, basis, application, ID card and anti-counterfeit technologies. Since its founding in 1967, the R&D Institute has developed security paper manufacturing techniques for banknotes, plate-making, and security inks. The institute is also pushing ahead with the commercialization of its special technique and design projects. In addition, the research center is trying to create an impetus to develop new technology related to money for the future. The institute’s knowledge property rights rose 502 in 2016 from 428 in 2014.
Recognizant of its solid performance, KOMSCO has earned the status of “A” in the management assessment of government agencies for the past three years. As such, the company is assessed as an “Innovation Icon” of Public Enterprises. CEO Kim said that “based on our intensified innovation efforts during the past three years, which have contributed to our solid management performance, we will continue to move ahead with development of cutting-edge technology in various fields in step with the fourth industrial revolution.”