Thank you for joining the Q2 2026 earnings call of OCI Holdings Company. I am Su Mi Lee, COO of OCI Holdings Company. I will walk you through our key financial results and business updates. You can see our Q2 consolidated income statement on page five. For the second quarter of 2026, OCI Holdings recorded a consolidated revenue of approximately KRW 1.02 trillion and an operating profit of KRW 108 billion. Despite challenging market conditions marked by Middle East tensions and policy uncertainties, revenue grew by 15% QoQ, and operating profit rose sharply. This was driven by OCI Energy's successful sales of a 500-MW solar project in the U.S. and improved profitability in OCI's chemical materials business. Meanwhile, OCI TerraSus has reported a minor operating loss as market demand remained subdued.
While operations fully recovered and cost efficiency improved QoQ, it has remained subdued as customers waited for the outcome of the Section 232 investigation. I will cover the subsidiaries performance in more detail later after page six. Let me move to page six, consolidated balance sheet. As of Q2 2026, total assets stood at KRW 8.5 trillion, liabilities at KRW 3.5 trillion, and equity at KRW 5.0 trillion. The main change in QoQ was new borrowings from OCI TerraSus to fund capital expenditures and working capital. Although this raised the debt-to-equity ratio by a 3.8% point QoQ, stronger cash flow from higher EBITDA and presale proceeds from DCRE brought our overall net debt ratio down to 18.6% from 20.1%. Now, let's move to page seven for a detailed review of OCI TerraSus and its subsidiaries. OCI TerraSus' revenue grew 8.3% QoQ, though the business reported a small operating loss.
Following the completion of maintenance in Q1, OCI TerraSus returned to a 90% operating rate in Q2, helping reduce its production costs. However, the market remained cautious because the Section 232 results were delayed. As a result, sales volumes fell short of targets, delaying our profit recovery. In NeoSilicon Technologies, our wafer business all commissioning procedures were completed during the quarter, and sample shipments were delivered to multiple customers. Looking to Q3, we expect a return to profitability as we anticipate higher sales volumes and lower costs. With the Section 232 result expected in August, spot sales and new short-term contracts should rebound. In the first half of this year, we made solid progress on long-term contracts with major U.S. customers. Both OCI TerraSus and NST will launch their capacity expansions in the second half. I will share more details about this later in the presentation.
Page eight shows the results for OCI Enterprises, our U.S. energy business. Revenue increased by 67% QoQ, accompanied by a substantial improvement in operating profit. The main growth driver was OCI Energy's 500-MW solar project sale, which boosted overall earnings. On the other hand, MSE's solar module sales declined due to weak U.S. residential demand. Despite higher average selling prices, profitability came under pressure, resulting in a minor operating loss. In Q3, OCI Energy is working to monetize an additional 250-MW project while expanding its pipeline. Meanwhile, our retained development assets are progressing smoothly through PPA negotiations and construction. Page nine covers OCI SE, which operates our cogeneration power plant in the Saemangeum Industrial Complex. Revenue was up 3.8% QoQ, supported by a modest rise in SMP. However, operating losses remained close to our Q1 levels as profitability was weighed down by high fuel costs and ongoing boiler maintenance expenses.
We expect performance to improve in the third quarter. Seasonal demand is driving higher electricity consumption and SMP. We remain focused on improving operation efficiency through the stabilization of boiler operation. Page 10 covers DCRE's urban development performance. Revenue rose 26% QoQ, and operating profit improved slightly. Revenue growth was driven by steady construction progress across three residential development sites. Despite the impact of taxes and land assets, operating profit improved compared to the previous quarter. Looking ahead, we plan to proceed a presale for Complex 9 in Q3. We are also moving forward with the land sale and commercial leasing to improve profitability. Page 11 highlights OCI Company's chemical and advanced material business. Revenue gained 5.6% QoQ, and operating profit increased significantly. Favorable market conditions across our petrochemical product lines brought higher volumes and stronger pricing. We expect this solid momentum to continue to Q3.
Semiconductor market recovery will drive demand for semiconductor-grade materials, while higher carbon black prices and specialty products will support earnings in our carbon chemical segment. We are also pursuing new opportunities in semiconductor materials to fuel our long-term growth. Now, let me show OCI's solar market landscape on page 13. OCI has been operating in the polysilicon industry for more than two decades. Over the period, we have experienced multiple industry cycles and significant shift in the competitive landscape. This slide shows how our market environment and customer base have evolved over the past decade. Before COVID-19, until 2020, our business focused mainly on supplying China's tier one manufacturers built on cost competitiveness and strong relationships. In the post-COVID period, following the 2022 Russian- Ukraine conflict, supply chain security became critical. Rising trade barriers and U.S. restrictions on Chinese solar goods pushed us to diversify the market.
We expanded our client base to include Southeast Asia producers supplying the U.S. market. Today, the U.S. solar market is entering a new phase. AI data centers investments are driving significant electricity demand. To capture this growth, OCI is preparing long-term agreements with U.S. end customers and strengthening strategic partnerships. Page 14 explains our updated solar materials business expansion plan. Turning to our expansion plan, we are moving ahead with capacity additions at OCI TerraSus and NeoSilicon Technologies. Our current capacity is largely locked in on the long-term contract. To meet surging U.S. demand, we will expand the production in phases through 2029. OCI TerraSus will expand its capacity to 70,000 metric tons, while NeoSilicon scales up from 2.7 GW to 11.5 GW. We are actively discussing additional long-term contract for this new capacity, which should further enhance the visibility of our mid-to-long-term earnings outlook.
Page 15 outlines OCI Enterprises' solar and energy storage business. U.S. power demand is surging, driven by AI data centers, which is creating major growth opportunities for OCI Energy. Out of our 760 MW operating pipeline, we are currently negotiating a new 500 MW PPA with global tech firms. With demand rising, both PPA pricing and project valuations are trending upward, a strong driver for our future profit. To wrap up, let me summarize our key priorities for the second half of 2026 in page 16. While short-term policy uncertainties remain around the Section 232, the long-term outlook for U.S. power and energy infrastructure remains highly attractive. OCI Holdings remains committed to investing in solar materials and energy infrastructure. Through strong partnerships, disciplined execution, and targeted investments, we are well-positioned for sustainable growth. Thank you for your attention. If you have any question, please contact our IR team.