CJ CheilJedang records net profit down on year but greater than expectations

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CJ CheilJedang records net profit down on year but greater than expectations

A customer picks up Hetbahn, microwavable rice bowls, sold by CJ CheilJedang, at a discount mart in Seoul. [YONHAP]

A customer picks up Hetbahn, microwavable rice bowls, sold by CJ CheilJedang, at a discount mart in Seoul. [YONHAP]

 
CJ CheilJedang reported a net profit of 252.7 billion won ($193.8 million) in the second quarter, down 3.4 percent on year.
 
Despite the on-year drop, it beat analyst expectations of 217.1 billion won, compiled on FnGuide.
 
The company reported revenue of 7.52 trillion won, up 19.1 percent on year. This also beat analyst expectations of 7 trillion won.
 
The earnings incorporate those of CJ Logistics, 40.16 percent owned by the food company.
 
The logistics company’s net profit rose 35.9 percent on year to 67 billion won, beating expectations of a 45.1-billion-won net profit. Revenue rose 14.2 percent to 3.14 trillion won, also beating expectations of 2.95 trillion won.
 
The company said the growth was helped by higher parcel delivery fees and signing more contracts to carry out deliveries abroad in the United States, India and Vietnam.
 
CJ CheilJedang’s food and bio business reported growth helped by overseas sales.
 
Its food business logged sales of 2.6 trillion won, up 17.8 percent on year. Overseas sales rose 20 percent to 1.22 trillion won, with sales of dumplings at U.S. discount marts rising 67 percent. Sales of frozen pizza were also strong, rising 38 percent.
 
The company said local sales rose 16 percent on year to 1.4 trillion won, helped by new product releases in homemade meal replacements and seasonings.
 
Sales of its bio business jumped 43.8 percent on year to 1.3 trillion won.
 
Some 95 percent of its bio sales come from overseas, with high demand for amino acid products in the United States.
 
CJ CheilJedang said it will focus on developing plant-based food products in the future for its food business. Its bio sector will focus on manufacturing marine-degradable plastics.
 
CJ Feed & Care, an animal feed company wholly owned by CJ CheilJedang, reported sales of 668.2 billion won, up 6.8 percent on year.
 
Its operating profit dropped 93.9 percent on year to 3.4 billion won, with the company citing rising grain costs.

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