“Our financial condition is very healthy” — HYBE CEO Lee Jae-sang addresses concerns over label's financial stability & ongoing NewJeans controversy

According to the report of Ten Asia on October 16, 2024, HYBE CEO Lee Jae-sang assured company employees during an internal town hall event about the company's financial standing. On October 14, Lee Jae-sang addressed the employees during the event and mentioned the company's cash reserves of 1.2 trillion KRW (approx. $890 million).

Addressing the company's ongoing controversy with NewJeans and ADOR's former CEO, Min Hee-jin, Lee Jae-sang claimed that over time the matter will be sorted. A few netizens claimed that HYBE has been losing money due to the internal strife with NewJeans. Lee Jae-sang addressed the matter and said,

"If we trust and wait, the issues will resolve themselves one by one. HYBE has 1.2 trillion KRW (approx. $890 million) in available cash assets, and our financial condition is very healthy." (as translated by Allkpop).

According to industry experts, Lee Jae-sang's remarks were intended to allay worries about HYBE's repayment of a convertible bond (CB) worth 400 billion KRW (about $296 million). They see this as an attempt to assuage worker worries about these budgetary difficulties amidst the ongoing controversy.

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HYBE CEO Lee Jae-sang confirms issuing 400 billion won worth of convertible bonds, displaying healthy financial standing

For the unversed, on July 24, 2024, Lee Jae-sang became the CEO of HYBE Corporations after Park Ji-won stepped down from the position. Ten Asia reported on October 16 that Lee Jae-sung highlighted the company's "available cash assets" as the total sum of cash, cash equivalents, and other current financial assets available at HYBE's disposal.

Currently, the company has over 1.745 trillion won (approx. $1.278 billion) cash in hand or liquid cash available. Among this, 753.1 billion won (approx. $551 million) is in other current financial assets and 321.4 billion won (approx. $235 million) is in cash and cash equivalents.

Despite the ongoing feud between HYBE and former ADOR CEO Min Hee-jin since April 2024, the company successfully issued 400 million won worth of convertible bonds in September 2024. On October 15, HYBE CEO Lee Jae-sang announced that the premium rate of the convertible bonds set by them was 20%—which is a 5% increase compared to the last time.

An industry insider told Ten Asia:

"Corporate CB repayment is usually done through CB conversion issuance. This successful CB issuance is evidence that the market highly values Hybe's growth potential and stock price increase potential. It is true that there is a lot of noise, but Hybe's financial status is positive."

Industry finance experts expect HYBE's profitable growth to be over 151.2 billion won (approx. $110 million) in the final quarter of 2024. This assurance stemmed from BTS' Jin's upcoming debut solo album release in November 2024. Additionally, HYBE's other popular K-pop group SEVENTEEN (under Pledis Entertainment, a HYBE subsidiary) raked in massive profit in October 2024.

SEVENTEEN released their 12th mini album, SPILL THE FEELS, on October 14, 2024. The album sold 2.49 million copies on its debut day, strengthening HYBE's cash flow reserves. Furthermore, HYBE subsidiaries like Belift Lab and KOZ Entertainment are contributing to solidifying HYBE's financial standing.

Belift Lab's ENHYPEN and KOZ Entertainment's BOYNEXTDOOR's latest releases have been witnessing massive album sales.

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In other news, HYBE subsidiary, ADOR, fired Min Hee-jin on August 27, 2024, and appointed Kim Joo-young as its new CEO. Min Hee-jin filed another injunction at Seoul District Court to call an emergency shareholders' meeting and get reappointed as ADOR's CEO. However, the final injunction hearing will be held at the end of October 2024.