CJ CheilJedang reported increased sales and operating profit for the third quarter of this year, driven by expanded overseas sales of its key products, including dumplings and Hetbahn, as well as growth in its bio-materials business. However, the technology materials segment recorded a loss despite increased sales due to investment burdens.
On November 10, CJ CheilJedang announced that its operating profit, excluding CJ Logistics, reached 203 billion won, a 6.9% increase compared to the same period last year. During the same period, sales rose to 4.23 trillion won, up 5.7%. Operating profit also increased by 25.4% compared to the previous quarter.
Including CJ Logistics, the consolidated operating profit was 309.1 billion won, a 7.4% decrease year-on-year, while sales increased by 7.0% to 7.39 trillion won.
By business segment, the lifestyle food division maintained operating profit at 118.7 billion won, consistent with the same period last year, while sales grew by 3.8% to 2.57 trillion won. Despite ongoing pressures from raw material prices and logistics costs, profitability was sustained through expanded sales of key overseas products, growth in domestic distribution channels, and cost efficiencies.
Overseas food sales reached 1.51 trillion won, a 3.7% increase from the previous year, supported by rising sales of global strategic products (GSP) such as dumplings and Hetbahn.
Regionally, sales in Europe saw the highest growth rate at 26%, driven by the expansion of distribution channels for new dumpling products. Vietnam experienced a 14% increase due to higher sales of rolls, seaweed, and noodles. Sales in China rose by 8%, bolstered by increased dumpling and frozen rice sales through warehouse discount stores and online channels. The Americas region grew by 3%, despite reduced currency translation effects due to exchange rate declines, thanks to demand for dumplings and Hetbahn.
Domestic food sales increased by 3.9% to 1.07 trillion won, with rising sales of key products like Hetbahn and soba noodles, alongside growth in new product lines. Sales of Bibigo grilled fish surged by 69%, while Baeksul's one-minute rice increased by 24%.
In the technology materials segment, despite increased sales, a loss was recorded. Third-quarter sales reached 232.6 billion won, a 20.2% increase year-on-year, but operating losses totaled 24.2 billion won.
Sales of natural fermented seasoning materials, such as Taste & Rich (TNR), and health and wellness (H&W) products expanded. Revenue from biodegradable bio-material PHA also increased due to securing major demand sources. However, strategic pricing operations for nucleic acid products and increased investment costs for expanding the market for future growth products burdened profitability.
The core materials segment showed significant improvement, with operating profit rising by 36.0% to 108.5 billion won, and sales increasing by 7.0% to 1.42 trillion won.
Growth in high-value amino acid products, such as arginine, and expanded lysine sales in the North American market supported the performance. Although prices in the materials business were reduced in line with government price stabilization policies, increased sales of amino acids for animal feed improved profitability.
CJ CheilJedang plans to continue expanding the overseas distribution network for its global strategic products, including dumplings and Hetbahn, in the fourth quarter. The company aims to enhance Hetbahn's competitiveness in the North American market and broaden sales channels in key regions like Europe.
In the technology materials segment, the company will work to recover performance in response to peak demand for nucleic acids. Sales of future growth products, such as TNR and PHA, will also be expanded. The core materials segment will focus on improving profitability for amino acid products like lysine and arginine.
A CJ CheilJedang representative stated, "We will accelerate the expansion of K-food territory in key regions based on the growth of global strategic products like dumplings and Hetbahn, while enhancing competitiveness in each business segment through responses to peak demand for nucleic acids, increased sales of amino acids for animal feed, and improved profitability of future growth products."
* This article has been translated by AI.
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