Schwan's Power Intensifies... CJ CheilJedang Achieves 5.8309 Trillion KRW in Q1 Sales

[Asia Economy Reporter Choi Saeng-hye] CJ CheilJedang announced on the 14th through its earnings report that its sales in the first quarter of this year grew by 16.2% compared to the previous year to 5.8309 trillion KRW, and operating profit increased by 54.1% to 275.9 billion KRW (consolidated basis).

Excluding CJ Logistics' performance, sales increased by 23.9% to 3.4817 trillion KRW, and operating profit rose by 53.3% to 220.1 billion KRW. The global sales ratio was about 60%, up approximately 10 percentage points compared to the first quarter of last year.

The food business division recorded sales of 2.2606 trillion KRW, an increase of 31.4% compared to the same period last year. Global processed food sales, including the U.S. Schwans (sales of 742.6 billion KRW), led the performance growth by achieving 1.0386 trillion KRW, an increase of about 126% year-on-year. Domestically, sales of key home meal replacement (HMR) products such as 'Bibigo Juk' and 'Bibigo Soup Dishes' as well as dumplings increased, offsetting the decline in sales of B2B items with a high proportion such as Dashida seasoning and sauces. Operating profit increased by 15.3% to 116.3 billion KRW, supported by business efficiency improvements and expanded Schwans sales.

The bio business division, which focuses on feed amino acids and food seasoning materials, posted sales of 677.7 billion KRW, up 15%. The market position of tryptophan, whose production capacity was increased last year, was strengthened, and growth continued through expanded sales of high value-added products such as arginine and cysteine. By restructuring the product portfolio toward high-profit items and reducing costs, operating profit reached 51.1 billion KRW, similar to the previous year.

CJ Feed&Care (feed + livestock) recorded sales of 543.4 billion KRW, an increase of 8.5% year-on-year, and operating profit turned positive to 52.7 billion KRW.

Since the second half of last year, CJ CheilJedang has taken proactive crisis response measures through high-intensity structural improvements such as strengthening profitability and improving financial structure. Even in the first quarter, when global uncertainties caused by COVID-19 expanded, the company minimized damage by maintaining net borrowings at the level of the end of last year.

CJ CheilJedang stated, “As a result of focusing on ‘innovative growth’ centered on profitability enhancement since last year, we achieved stable performance despite the global crisis situation,” and added, “We will continue future growth by concentrating capabilities on core products and businesses, and securing competitiveness through strategic R&D investment.”