In terms of production, we plan to strengthen our own power generation capacities by securing various power assets that are equipped with stability, sustainability, and economic feasibility. In terms of consumption, to cater to industry clients with high volume usage, we will provide integrated services spanning across equipment diagnostics, investment, replacement, and O&M services so as to diversify our revenue model.

Lastly, in terms of solutions, to respond to fast-growing AI data center market, we will provide solutions for power management, server cooling, and DCMS with an ESS component for AI data centers, and through differentiated tech solution offerings such as AI-driven power trading software, we will create higher value-add. Next is strategy on global LNG value chain expansion, which will form the basis of supporting fundamental competitiveness of the energy business.

To successfully transition to a power operator, ensuring stable sourcing of LNG, which is the feedstock for power generation, is essential. By sourcing LNGs on a timely basis from the US, Southeast Asia, and Australia, where price is competitive, we will secure competitive cost base for generation.

Based on such competitive winds, we plan to target regions with growing energy demand both at home and abroad as we expand our business. In Korea, we are pursuing 1.5 gigawatt-size combined heat and power project in Yongin semiconductor cluster and Namyangju residential area, while in Vietnam, we plan to expand LNG generation and electricity supply projects, focusing on regions with growing power demand.

All in all, we will establish a full value chain across power production, consumption, and solution underpinned by solid foundation of global LNG infrastructure to transition into a total energy company, ushering in the age of electrification. 2026 will be a year in which SK Innovation achieves both objective of stronger financial fundamentals and growth towards future to become a true energy company.

In this process, we ask shareholders and investors for your continued support and trust. We will come back to you with more concrete details in due course.

Thank you. Next is on the detailed business results for the fourth quarter.

In Q4 2025, on weaker crude price, refinery and petrochem sales declined, while battery revenue also declined due to lower sales volume following the removal of EV subsidies in the US market, which drove revenue down 747.5 billion Q-over-Q, with Q4 revenue reporting 19 trillion 671.3 billion. Despite strong refining margin and solid lubricant performance, due to off-peak seasonality for E&S business and drag on profitability of battery business, operating profit fell by 291 billion Q-on-Q, reporting 294.7 billion won.

On the non-operating side, losses widened Q-over-Q, amounting to 4 trillion 657.3 billion won, driven by battery business impairments among other factors. The breakdown comprises of FX-related loss of 52 billion, derivative loss 211.8 billion, net interest expense of 217.7 billion, equity method loss of 135.9 billion, and other expense of 4 trillion 39.9 billion won.

Next is on the financial position. Total asset as end of 2025 was 105.6 trillion won.

Compared to end of last year, due to declines in trade receivables for battery and materials business and impairment of battery business, total asset fell by 4.9 trillion. Liabilities came in at 69.2 trillion won, a decrease of 1.7 trillion on decline in trade payables for the battery and materials business.

Debt-to-equity ratio was up 11 percentage points year-to-date, reporting 190%. Net debt reported 22.5 trillion won, decreasing approximately 6 trillion won due to the reclassification of BlueOval SK under assets held for sale.

Next, we will present Q4 performance by business line. The performance and outlook for each area will be presented by management from the respective businesses.

First, for the refinery business, we have Juyong Yoo, Head of Strategy Operation Division from SK Energy, and he will give the presentation.

Good morning, this is Juyong Yoo, Head of Strategy Operation Division from SK Energy. Let me go over our refinery business in Q4 2025.

In Q4, the refinery business posted an operating profit of 474.9 billion won, up 170.7 billion won Q-o-Q, driven by higher refining margins supported by OSP cuts from oil-producing countries and stronger petroleum product markets. Ukraine's drone attacks caused significant disruptions at Russian refineries.

Also, the onset of the heating oil peak season also contributed to improved middle distillate market conditions. Next, I will discuss the market outlook for Q1 this year.

While concerns over oversupply remain due to rising crude production, geopolitical tensions involving Iran, Russia, and Latin America are expected to intensify. As a result, we anticipate oil prices to remain range-bound rather than experience a sharp decline.

Refining margins are remain strong, supported by ongoing refinery restructuring, production disruptions, and recent US cold weather. While demand may face some downward pressure as winter comes to a close, our margins are expected to remain healthy in the near term due to the upcoming TA season and low OSPs.

Next, we have Kim Yong-soo, Head of Planning Office of SK Geo Centric, for petrochem business. This is Kim Yong-soo, Head of Planning Office of SK Geo Centric.

Let me discuss the petrochemical business results. In Q4, the business recorded an operating loss of 8.9 billion won as spreads for products such as benzene, PE, and PP declined.

However, the spread of PX, the key product, increased due to expanded gasoline blending demand. Turning to the 2026 market outlook.

For aromatics, key products PX and benzene are expected to see stronger market conditions as demand for derivatives recovers. In particular, benzene has potential for further improvement should US reciprocal tariffs be lifted.

By contrast, olefins and polymers are expected to face weaker market conditions due to new capacity additions. However, we also believe that because of naphtha price remains flat, it is going to be rather range-bound.

Amid an unfavorable business environment, the company will continue to enhance profitability through optimal operating rates and operational optimization. Next, Kim Mi-kyung, Head of Corporate Planning and Development Office of SK Enmove, will present the lubricant business.

I am Kim Mi-kyung, Head of Corporate Planning and Development Office of SK Enmove CIC. Let me discuss the lube business.

In Q4, the lubricants business enjoyed higher margins due to falling oil prices. Efforts to optimize our Group III base oil production and sales led to a slight increase in volumes despite the seasonal off-peak.

As a result, Q4 operating profit rose 10.4 billion won Q-o-Q to 181 billion won. In 2026, amid a sluggish global economy and no clear signs of demand growth, spreads are expected to decline slightly due to intensified supply competition.

Nevertheless, we will actively respond to ensure stable earnings by leveraging our leadership in the Group III market. Next, SK Earthon Head of Planning and Support Office Kim Kyoung-jun will present the E&P business.

This is Kim Kyoung-jun, Head of Planning and Support at SK Earthon. I will present the E&P business.

In Q4, the E&P business posted operating profit of 81 billion won, down 8.3 billion won Q-o-Q. The decline was primarily due to lower oil prices, which fell nearly 8% from Q3, and reduced sales volumes.

We have completed the drilling of two additional production wells at the China Block 17/03 in Q4, and we are continuing efforts to minimize the natural decline in production through reservoir pressure management. At the Vietnam 15-1 Block, additional production wells are being drilled to increase gas output from White Lion field.

Also, at Vietnam's Block 15-1/05, LDV structure development is ongoing, including production well drilling and construction of production facilities. Production is expected to commence in Q4 2026 upon completion of development works.

At Vietnam's 15-2/17 exploration block, as previously announced, the first evaluation well targeting the HSB structure was successfully drilled, and we identified a 131-meter thick oil layer and confirmed production of roughly 6,000 barrels per day. We have commenced drilling a second appraisal well and plan to complete a third one within the year.

Based on the results, we will assess the commercial potential of the entire structure. At Malaysia's SK427 exploration block, where we are the operator, drilling of the first exploration well has commenced.

Two promising structures within the block will be drilled sequentially, starting with the first well. Thank you.

Next, I invite Kim Young-kwang, Head of Financial Management Office of SK On, to present the battery business. Good morning, I am Kim Young-kwang, Head of Financial Management Office at SK On.

Let me run through Q4 results and 2026 outlook for the battery business. Q4 revenue recorded 1 trillion 457.2 billion won, down 19% Q-o-Q, reflecting base effects from the repeal of EV subsidies in the US despite continued solid sales momentum in the European market.

Q4 operating profit recorded a loss of 441.4 billion won, reflecting lower utilization rates due to inventory adjustments by customers in the North American market, year-end shutdowns at automakers' plants, and a reduction in the AMPC. Despite these challenges, the company continues to strengthen its fundamentals through company-wide cost efficiency initiatives and efforts to maximize synergies from the integrated entity.

In particular, in 2026, we plan to focus on sustainable growth and enhanced financial soundness through portfolio rebalancing. With respect to BlueOval SK, we are in the process of ending the JV agreement with Ford.

Following the conclusion of the JV, SK On will hold 100% ownership of the BlueOval SK Tennessee plant, while Ford plans to operate the Kentucky plant independently. In addition, with respect to the EOE JV in China, the structure is scheduled to be reorganized through an SKOJ equity swap agreement to support a more focused and selective approach.

Efficiency initiatives are also under review for the European entities. Overall, we are accelerating portfolio rebalancing to enhance the financial soundness and investment efficiency of the battery business.

At the same time, we're strengthening our fundamental cost competitiveness through a rigorous review of our cost structure and improvements in operational efficiency, while driving company-wide cost reductions by innovating SCM and manufacturing capabilities by leveraging AI and digital technologies. Meanwhile, to secure sustainable growth drivers, we continue to prepare for business expansion through new applications.

In particular, expanding the ESS business is one of our key strategic priorities. Following the project award from Flatiron last year, we are targeting 20 gigawatt hour of global orders in 2026, primarily in North America.

Also, we aim to further strengthen our LFP battery production capabilities and secure new customers to sustain order momentum. In addition, we're accelerating the development of next-generation batteries and advanced manufacturing technologies to enhance our technological competitiveness.

Besides advancing key initiatives such as cell-to-pack, thermal propagation, dry coating, and semi-solid technologies, we have recently signed an MOU for vanadium ion batteries and preparing for the full-scale operation of a solid-state battery pilot plant, reinforcing our focus on securing technologies to lead future markets. In addition to ESS, we are accelerating new market development to broaden battery applications, including humanoid robots.

We also plan to actively enhance profitability in new growth areas, such as ESS, beyond our traditional mobility battery business. Thank you.

The materials business recorded a quarter-on-quarter decline in revenue due to reduced shipments to North America following the termination of US EV subsidies in September 2025. In 2026, we plan to focus on strengthening core competitiveness through diversification of the customer and product portfolio and improvements to the manufacturing cost structure.

Next, for Q4 SK Innovation E&S results, I invite Mr. Kang Yun-won, Head of Management Planning Office.

This is Kang Yun-won, Head of Management Planning at SK Innovation E&S. SK Innovation E&S recorded Q4 operating profit of 117.6 billion won, down Q-o-Q, as SMP declined amid the full impact of lower oil prices and reduced power demand following the transition into the shoulder season, as well as scheduled power plant maintenance to ensure stable operations during winter.

In 2026, SMP is expected to remain under pressure due to continued declines in oil prices. Nevertheless, we will continue to strengthen our cost competitiveness through stable sourcing of low-cost LNG supplies from Australia's Calita Barossa field and Indonesia's Tangguh volumes, minimizing downside risk and ensuring stable earnings.

This ends the presentation, and now we move on to Q&A. We want to first address several questions that we received in advance on our website.

For this earnings call, we received questions from the investors and analysts ahead of time and preselected the ones that were of most interest. For those frequently asked questions, we will provide the answers through simultaneous interpretation.

The first question concerns the business and financial impact of the termination of the BOSK JV. I would like to invite Mr.

Kim Young-kwang, Head of the Financial Management Office at SK On, to respond. I am Kim Young-kwang, Head of the Financial Management Office at SK On.

I would first like to address the frequently raised questions regarding battery asset impairments. As part of the restructuring of BlueOval SK, our joint venture with Ford, we recognized asset impairments in 2025.

Including these, the total impairments recognized in Q4 amounted to 4.2 trillion won. As a result, pretax losses temporarily increased.

However, I would like to emphasize that this was a one-off accounting adjustment made in accordance with accounting standards to reflect asset values more realistically and has no direct impact on cash flows. In particular, the impairment of BlueOval SK assets resulted from changes in Ford's plans for the utilization of the Kentucky plant, which Ford is scheduled to acquire.

At the closing, expected in Q1 of 2026, Ford will assume the Kentucky plant-related assets and associated liabilities, including substantial borrowings. As Ford will take over the Kentucky assets and liabilities in exchange for a paid-in capital reduction of its equity in BOSK, approximately 5.4 trillion won in debt related to Kentucky operations will be eliminated.

Accordingly, our financial structure is expected to improve compared to year-end levels. This asset impairment was a proactive measure to enhance financial transparency and reinforce business stability amid an uncertain operating environment.

By recognizing these losses early in 2025, we have resolved uncertainties and mitigated future financial burdens. From 2026 onward, we expect positive effects, including improved earnings and greater management stability under a leaner asset structure.

Going forward, we will accelerate efforts to strengthen our financial structures, focus on core capabilities, and enhance operational efficiency, enabling a swift recovery from the one-off impact of the impairment and laying the groundwork for sustainable growth. We'll continue to respond proactively to market changes and challenges, uphold the trust of investors and the market, and create long-term value through responsible management.

Thank you. The second question is on plans for future capital expenditures and shareholder returns.

I invite Mr. Seo Won-ki, Head of Finance Division, to take the question.

I am Seo Won-ki, Head of SKI Finance Division. For 2026, we planned CapEx of 3.5 trillion won.

By business segment, this includes 1.3 trillion won for the battery business, 0.9 trillion won for SK Innovation E&S, and a combined 1.3 trillion won for maintenance and strategic investments. Going forward, we will continue to strengthen our core business competitiveness and improve financial soundness to secure a solid financial foundation for stable growth.

Now turning to shareholder returns. We are executing portfolio rebalancing initiatives to evolve into a total energy company, including the merger with SK E&S in 2024, the merger of SK On and SK Enmove in 2025, and ongoing asset optimization measures.

In 2025, we made progress in capital augmentation and portfolio restructuring. Nevertheless, unavoidable one-off losses were incurred as a result of our asset optimization initiatives.

Also, in light of the subdued earnings environment and ongoing CapEx requirements, we have decided not to pay a dividend for the 2025 fiscal year. In 2026, we will further advance portfolio rebalancing by improving returns in our core businesses while reducing exposure to low-growth or low-return businesses.

At the same time, to build future growth centered on electrification, we will pursue disciplined investments to transform our business model around the power business and expand the global LNG value chain. Going forward, with respect to shareholder returns, we will reassess our dividend policy based on a comprehensive review of net debt and free cash flow levels and engage in active communication with shareholders and investors.

We'll continue to focus on enhancing corporate value and shareholder value. Thank you.

This ends the session of preselected questions, and we will now switch to live Q&A. Please note that this session will be conducted through consecutive interpretation.

Please state your name and affiliation when asking your questions.

I am Jang Woojae from KB Securities, would like to ask you two questions. First question, there has recently been talk about application of NCM batteries to robotics and aerospace, would like to understand as what the company's R&D activities are like with regards to this new frontier, and compared to the industry, what is your competitive edge?

My second question relates to the financials. Can you provide us with a more detailed breakdown relating to the battery business impairment, and is that all reflected already in the 2025 numbers, or would there be new aspects that would be incurred in 2026?

Responding to your first question, I am Kim Young-kwang, Head of Financial Management Office at SK On. Under the uncertain business backdrop, in order for us to mitigate that level of uncertainty, we are focusing on diversifying the product portfolio.

With regards to the EV batteries, we are currently in talks and discussions with multiple number of potential customers across different industry sectors, talking about a potential opportunity for supply of such technology going forward. Recently, there has been a talk about the logistics vehicle robots, as well as multipurpose unmanned vehicle, and ESS use for ship or vessels.

On multiple fronts, we are engaging in various different discussions so that we may be able to tap into additional supply opportunities.

Responding to the second question, as mentioned, as of the fourth quarter, the impairment loss that was booked was 4.2 trillion in total, of which 3.7 trillion relates to the Ford JV, the BlueOval SK joint venture, and the remainder, which is 0.5 trillion, is a sum of the impairments that are collated or collected across all of the other sites. With regards to whether there will be additional impairment that will be booked going forward, please do understand that it will be difficult to provide you with the specifics at this point.

Thank you very much for the opportunity to ask questions. I am Lee Jin-ho from Mirae Asset Securities.

I have two questions. First one has to do with your future growth strategies.

You talked about your plans to go electrification and to become a power business operator. I understand that this is targeting AI DC business going forward.

Can you elaborate and offer some more details about the target region and also the scale of such business project? Second of all, this question involves financials.

You've talked about during the presentations your plans to divest and also monetize non-core assets so as to reduce net debt. What sort of assets are on the list?

This is Seo Won-ki from SKI, Head of Finance Division, and I will take your first question. With regard to your question about electrification, future plans, yes, we do have some detailed plans already drafted, but I would have to say that it is too early for us to share that information with the market.

At a future date, we will communicate the further information through IR office when they become available. As for your second question, SK Innovation has energy-related infrastructure and technologies involving LNG, fuel cell, ESS, and SMR.

Going forward, we will be collaborating with global hyperscale businesses, and we are making preparations to conduct pilot tests overseas, and we are also working with SKI Environment and Science Institute in order to develop energy-related softwares, and we will communicate with the market when further details are available. With regard to your second question, yes, net debt in 2025 stood at 25 trillion 500 billion Korean won, and we have reclassified BOSK asset held to be sold into a different accounting group, and that resulted in a reduction of 6 trillion Korean won.

In 2026, as we mentioned, we plan to divest and also monetize non-core assets. It is too early to state the names of the assets at this point in time, but we are continuing our efforts to execute portfolio rebalancing so that we can ensure financial stability and reduce net debt.

Thank you for taking my question. I'm Lee Jin-myung from Shinhan Investment & Securities, would like to ask you two questions.

First question relates to your battery business. Would like to gain some insight and more color in terms of your ESS production capacity.

Going forward, you will be operating the Tennessee plant independently, could you share with us the operating plan going forward? Also, what would be your regional approach, the measures that you would employ to respond to regional demand and requirements when it comes to EV vehicles?

Second question, I understand that you are undertaking your chemical business restructuring at Ulsan, would like to gain an update as to how it is progressing. Responding to your first question, I am Kim Young-kwang, Head of Financial Management at SK On.

As last September, we entered into an arrangement with Flatiron, who is a US project developer, winning an ESS order amounting to 1 gigawatt, and we will start to make delivery starting from the second half of 2026. Also, we have right of first negotiations with regards to 6.2 gigawatt hour up to 2030, and so for this year, we will be exerting efforts to make additional order wins amounting to 20 gigawatt

hour.

In terms of the production capacity that would meet such demand is we will make use of our SKBA site, which is a wholly-owned subsidiary of our company, and also after the closing of the joint venture restructuring with Ford, we will also be making use of the Tennessee site. At this point, we are reviewing various different options and coming up with the most optimal production plans.

Yes, moving on to the additional question, I am Ahn Gon, Head of Planning Office from SK On. With regards to the operational plan for the Tennessee site, based upon the partnership that we have with Ford, we will be in alignment with the electrification plan that Ford had put in place, under which we will be providing new vehicle batteries for extended-range EVs.

We will make optimal operation of the Tennessee plant, where we will make the production and supply those batteries to the OEM plant under Ford. Currently, we are working under the SOP timeline of 2028.

We will make full leverage out of the advantage of having Tennessee plant 100% under our ownership to provide and meet the demand of not just Ford, but will find opportunities to supply to other OEMs as well, and in so doing, we plan to maximize on the run rate and the utilization of the Tennessee plant. We will also seek ways to improve on the unit cost optimization so that we can further drive better margin or profitability.

As was previously mentioned, for our Tennessee plant, we will be able to not only support the production of ESS, but also use the Tennessee plant to meet the demand of North America for the local production requirement. We will come back to you and provide you with more concrete details later on when we have more concrete data to share in terms of new order wins and plans.

Regarding the third part of your question as to our regional response to the changing EV market backdrop, for North America, with the removal of subsidies starting from the fourth quarter, there was an impact on the EV demand in the greater market. In light of the production efficiency, we have made adjustments to the production line utilization, and on top of that, going forward, we expect there will be an increase for ESS demand in North America.

Slate EV, which is a new startup EV company in the United States, is currently working under an SOP timeline, and in line with that, we are hence planning for a recovery of the line utilization. Now for the European market, a number of countries in Europe started to renew the provision of subsidies end of last year or beginning of this year, and so we see that there would be a solid demand coming out of the European market, which is going to support our utilization at a steady level.

Having said that, there are certain sites where the lines have been converted to non-utilization, we will very closely follow how the market moves and come up with the most optimal operational plan. Yes, hello.

I am the Head of Planning Office from SK Geo Centric, responding to your question about the industrial restructuring at Ulsan. Under the overarching goal of achieving sustainability of the petrochemical industry, the three companies within that complex are working together to create a cooperative arrangement.

Basically, the objective is to drive at a collaborative arrangement within the first quarter. It's quite hard to share with you the details at this point.

However, the discussion points would include rebalancing of the portfolio, having a greater focus on high-value-add products, and also dealing with less competitive facilities. Once again, having said that nothing yet has been confirmed, once we gain more concrete information, we will come back to you.

Thank you. This is Shin Hong-joo from Shinyoung Securities, and I would like to ask two questions.

First question has to do with your chemical business. It is mentioned in the presentation deck that you plan to divest and also suspend some of the chemical businesses.

What are those businesses? Can you elaborate?

Will there be additional businesses that will be divested or suspended in 2026 following 2025, and what would be the costs involved? My second question has to do with battery projection for 2026.

What are some of the sales volume that you project in 2026? Because of the suspension of EV subsidies, I think that the market backdrop is going to still be challenging for this year.

When do you think that the market will pick up again for EV batteries? Yes, this is Baek Il-hak, Head of Corporate Finance Planning Office at SKI.

I will address your first question. To answer your first questions, we are working on portfolio rebalancing so as to enhance our fundamental and core competitiveness for our chemical business.

To elaborate, we have included SK Primacore America in the US, and SK Primacore Europe in Spain, and also SK Functional Polymer of France in our portfolio rebalancing target list, and the historical profit and losses of these companies have been classified into P&L from discontinued operations. On top of that, we plan to continue to carry on portfolio rebalancing this year, 2026, so that we can improve margins and profitabilities of low-profit businesses and facilities.

The concrete information is not available yet, once we have a decision, we will come back to the market. This is Ahn Gon from the Head of Planning Office of SK On.

I will take your second question regarding battery business projection. Starting from two years ago, we have worked on reducing costs, improving productivity, and also yield, and once sales pick up again, we have prepared the cost structure so that we can turn profit immediately.

That said, in 2025, because of the amendment to IRA, the demand for EV in the US has dwindled, and this led to the delay in the improvement of our profits. In 2026, going forward, we plan to work on improving financial structure and also enhance cost competitiveness so that we can much more competitive when it comes to profitability.

Also, we plan to win more orders related to ESS businesses so that we can also enhance operation rate and also profitability. In 2026, the company's view is that uncertainties surrounding the battery business is going to continue, therefore we're going to make all-out efforts to enhance cost efficiency and cost optimization, and we will also work on financial stability together with our merged entities, SK Enmove and TI.

You asked about the market outlook for the US EV market. We believe that because of the abolishment of the IRA in Q4 2025, this had a blow on overall EV demand in the US market, but we believe that in 2026, the demand for EV is going to recover to the level of other ordinary years.

We believe that the demand is going to be similar to other years in 2026, but then we maintain our conservative view as to our battery market outlook. With regard to the EV market in the US, we believe that many of the EV launch plans have been canceled.

However, I think that gradually the market is going to shift toward low-priced, more efficient EVs other than highly-priced premium EVs with price tags of over $50,000, and those affordable EVs will become much more popular in the US market. In line with such a trend, I believe that OEMs will be able to offer more price-competitive EVs through price optimization efforts without their dependency on government subsidies.

In line with that, we will also work on cost optimization so that we can work together with the OEMs in line with their expectations and also market expectations.

I am Hwang Sung-hyun from Eugene Investment & Securities. I would like to ask two questions.

First, when is your timeline expectation in terms of bringing gas from the Calita Barossa gas field, and what impact will this have on your financials? We've seen the lubricant market quite strong with the absence of any capacity additions planned in the market.

From the company's perspective, what is your assessment? When do you think that this strong market will continue?

I am Kang Yun-won, and I will be responding to your first question. I'm from SK E&S, I'm the Head of Management Planning.

As we've communicated through a recent press release for Calita Barossa gas field, we hold a stake of 37.5%. We've made investment of $1.6 billion, and we're expecting 1.3 million tons on an annual basis, and this will form the basis of us adopting a low-cost LNG.

In terms of production, actually yesterday we had the first cargo shipment. Right now it's in the ramp-up phase, we're at about 70% to 80%, within the first quarter, earliest next month or even latest by March, we are expecting a full running of the field.

The produced cargo is going to be on a pro rata basis according to the arrangement, and so for SK cargo, we are expecting the first shipment in February.

The CB gas volume that we are expecting is going to be around 20% of the total 6 million LNG ton portfolio that we have within the company, and we believe that the CB volume is going to work to replace the highly priced spot volume. Recently, we are seeing a downward trend in the spot prices, the impact to which this replacement or substitution is going to bring may be smaller than originally expected.

However, against this very fluctuating LNG market backdrop, this will help us gain a stable sourcing, as well as help us improve on the cost competitiveness side. It will have a significant impact.

Thank you. Responding to your question on the second question, I am Kim Mi-kyung from SK Enmove.

In 2026, as mentioned previously, considering the demand and supply dynamics, we expect the lubricant market to be soft to moderate. On the supply side, we're expecting certain commercialization in 2026 by certain companies of India and Saudi Arabia, and there are some capacity additions planned coming out of Germany.

However, if you look at Group III product, it will take time for a new entrant into the market to start to influence the market, we expect the market will start to feel the impact in 2027 or 2028.

On the demand side, because Group III base oil is used for high-end engine oils, it would benefit from that trend and also would benefit from the structural and secular trend of electrification. From a mid to long-term perspective, we expect demand to rise.

We will continue to tap into potential customers and drive optimization in terms of cost base and in terms of SCM so that we could lay a solid basis for this business going forward. This ends the Q&A session and the SK Innovation's earnings presentation for Q4 of 2025.

I would like to extend my deep gratitude to investors and analysts for joining us today. Thank you.