CJ CheilJedang beats expectations as first-quarter net rises 13%

CJ CheilJedang's headquarters in Jung District, central Seoul. [CJ CHEILJEDANG]

CJ CheilJedang logged an expectation-beating net profit of 247.9 billion won ($194.2 million) in the first quarter, up 13.3 percent on year.

FnGuide's consensus forecast was 160.9 billion won.

Revenue rose 13 percent on year to 6.98 trillion won, higher than the market consensus of 6.65 trillion won.

The earnings incorporate those of CJ Logistics, 40.16 percent owned by the food company.

The logistics company's revenue rose 6 percent to 2.86 trillion won, and it operating profit increased 57 percent to 75.7 billion won. The growth was attributed higher delivery fees, which the company increased for corporate customers in January. It said more demand for deliveries in Korea and foreign countries, including the United States, India and Vietnam, also helped.

CJ CheilJedang's food business reported revenue of 2.61 trillion won, up 13 percent on year.

The operating profit of its food business fell 4 percent on year to 169.7 billion won due to inflation driving up the prices of ingredients worldwide.

Overseas sales were strong, up 15 percent on year to 1.2 trillion won. In the United States, sales of dumplings jumped 71 percent on year and frozen ready-to-eat-meals 63 percent. Hetbahn microwave rice was another success, with sales up 66 percent on year.

Revenue of its bio business, which produces food additives and plant-based proteins, rose 39.3 percent to 1.08 trillion won. Operating profit rose 128 percent to 175.8 billion won due a focus on selling products with high profit margins, such as food-grade amino acid supplements for animals.

CJ Feed & Care, an animal feed company wholly owned by CJ CheilJedang, logged revenue of 626.3 billion won, up 6.6 percent on year, but operating profit fell 78.2 percent to 19.4 billion won.

The company blamed rising price of raw material, such as grain.

BY LEE TAE-HEE [lee.taehee2@joongang.co.kr]