Korean noodle companies have experienced growth in sales during the first half of the year, driven by the global popularity of K-noodles, but their profitability has varied significantly. Samyang Foods led in operating profit, buoyed by the global success of its Buldak brand, while Nongshim also saw substantial profit increases thanks to strong overseas performance. In contrast, Ottogi, despite achieving double-digit growth in international sales, reported only a 2% increase in operating profit due to its domestic-focused business structure.
According to the food industry on August 17, Samyang Foods reported consolidated sales of 1.4847 trillion won and operating profit of 353.3 billion won for the first half of the year, marking increases of 37.2% and 39%, respectively, compared to the same period last year. The operating profit margin stood at 23.8%.
While Nongshim and Ottogi surpassed Samyang Foods in total sales, they lagged in profitability. Nongshim's sales reached 1.8901 trillion won, with an operating profit of 126.7 billion won, reflecting increases of 7.3% and 31.7%, respectively. Ottogi's sales grew by 4.2% to 1.899 trillion won, but its operating profit only rose by 2% to 104.6 billion won. Nongshim's operating profit margin was 6.7%, while Ottogi's was 5.5%, both lower than Samyang Foods. Notably, Samyang Foods' operating profit alone exceeded the combined operating profits of Nongshim and Ottogi by 122 billion won.
In terms of noodle sales, Nongshim remains the leader. Its noodle sales for the first half of the year increased by 8.1% to 1.6227 trillion won. Samyang Foods' noodle and snack sales surged by 39.0% to 1.3449 trillion won, while Ottogi's noodle product sales rose by 4.4% to 548.8 billion won. While Nongshim continues to lead in overall noodle sales, Samyang Foods is rapidly closing the gap.
The key driver behind Samyang Foods' strong performance was its overseas business. International sales reached 1.2308 trillion won, a 42.4% increase from the previous year, accounting for 82.9% of total sales. Domestic sales also grew by 16.5% to 253.9 billion won, but the rapid growth of international sales was the primary contributor to overall performance.
The popularity of the Buldak series is spreading globally, with sales in the Americas increasing by 54% to 203.6 billion won and in China by 44% to 181 billion won in the second quarter. European sales also surged by 61% to 80.6 billion won. Second-quarter international sales exceeded 600 billion won for the first time, reaching 645.8 billion won.
Nongshim also leveraged its overseas markets for growth. Its international sales, including exports and revenue from overseas subsidiaries, rose by 16% to 757.9 billion won in the first half of the year. Although this accounted for 40.2% of total sales, which is lower than Samyang Foods, stable growth from key subsidiaries in the U.S., China, and Japan, along with successful expansion into Western Europe, contributed to its performance.
Notably, the improvement in international performance helped offset the sluggish domestic market. Nongshim's domestic sales fell by 0.5% to 1.2487 trillion won due to reduced consumer spending and intensified market competition, but international sales increased by over 20%, driving overall growth.
Ottogi also reported double-digit growth in its international business, with overseas sales reaching 220.5 billion won, a 12.3% increase from the previous year. The popularity of K-food contributed to a 7.6% increase in sales for its U.S. subsidiary, which reached 56.6 billion won.
However, despite being the largest in total sales among the three companies, Ottogi's diverse portfolio, including instant rice, curry, and sauces, results in a lower dependency on noodles and a higher domestic focus. Its international sales accounted for only 11.6% of total sales, which is significantly lower than Samyang Foods (82.9%) and Nongshim (33.9%), limiting the impact of international growth on overall performance.
An industry insider noted, "As the domestic noodle market enters a mature phase, the future success of companies will depend on how quickly they can expand their local distribution networks and establish their brands overseas. The profitability of international operations is expected to be a key factor in widening the performance gap among the companies."
* This article has been translated by AI.
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