[Click eStock] "Foodnamu, Expecting Both Top-Line Growth and Profitability Improvement"

[Asia Economy Reporter Ji-hwan Park] IBK Investment & Securities stated on the 20th that Foodnamu is expected to achieve both top-line growth and profitability improvement.

Researcher Hwan-wook Lee of IBK Investment & Securities said, "The expected performance for the fourth quarter of last year is sales of 45.3 billion KRW and operating profit of 1.5 billion KRW, representing increases of 56.6% and 88.3% respectively compared to the previous year." Although rapid top-line growth is expected to continue due to the increase in RankingDakCom members, profitability improvement is expected to be somewhat limited as the sales proportion of low-margin consolidated subsidiaries rises.

The sharp increase in membership and diversification of the sales portfolio are positive factors. The number of members joining RankingDakCom has shown a steep growth trend, with the total number of members reaching 2.18 million as of the end of 2021, an increase of 48.3% compared to a year earlier. It is judged that the accumulated big data significantly influences product development and sales performance. The flagship brand Masitdak continues to show steady sales growth, and the sales proportions of new brands Itmate and OneAM have increased to 29% and 9% respectively, indicating smooth progress in diversifying the sales portfolio.

Additionally, the combined transaction amount of the new platforms ‘PickyDiet’ and ‘GgeunJilMart’ surpassed 15 billion KRW as of the end of 2021, steadily establishing a growth roadmap as a wellness company.

This year, top-line growth and gradual profitability improvement are expected. The annual expected performance is sales of 240.1 billion KRW and operating profit of 12.7 billion KRW, representing increases of 29.7% and 159.6% respectively compared to the previous year. The monthly number of new members is analyzed to be around 60,000 to 70,000, with the total number of members reaching 2.94 million.

Researcher Hwan-wook Lee said, "The business strategy focused on expanding the top line will continue for the time being," adding, "Marketing activities centered on content such as YouTube are planned instead of the existing model-focused TV advertisements, so gradual profitability improvement is also expected." Furthermore, additional performance improvements are possible due to the expansion of offline sales channels and the promotion of exports to the North American region.