[Click eStock] "CJ Daehan Tongun, Earnings Fell Short but... Not Bad"

[Asia Economy Reporter Kwon Jaehee] Daishin Securities maintained its investment opinion of 'Buy' and target price of 160,000 KRW for CJ Logistics on the 11th.

In the first quarter, CJ Logistics recorded sales of 2.8 trillion KRW and an operating profit of 75.7 billion KRW. By business segment, CL sales were 646.9 billion KRW with an operating profit of 29.7 billion KRW, parcel delivery and e-commerce sales were 846.6 billion KRW with an operating profit of 28 billion KRW, and global sales were 1.264 trillion KRW with an operating profit of 17.2 billion KRW.

This performance was below the earnings forecast but aligned with the lowered market consensus.

However, notable points in the results include the slowdown in growth rate of the general parcel delivery market, high growth in same-day and dawn delivery markets, and the increase in parcel delivery unit prices.

Parcel delivery volume in the first quarter was 876 million boxes, a 1% increase compared to the same period last year. Among these, CJ Logistics' parcel volume was 390 million boxes, a 10.5% decrease year-on-year, which appears to be influenced not only by the strike impact but also by the slowdown in e-commerce growth that had recorded high growth during the COVID-19 phase.

On the other hand, CJ Logistics' fulfillment volume and new LMD volume in the first quarter were 84 million boxes and 27 million boxes respectively, showing high growth rates of 112.4% and 281.4% year-on-year.

The global subsidiaries also showed strong growth, with the US (38%), India (30%), and Vietnam (25%) subsidiaries expanding in scale, and forwarding sales increasing by 27%.

Parcel delivery unit prices are also rising. In the first quarter, the unit price per box was 2,290 KRW, a 14.6% increase compared to the previous year.

Researcher Yang Ji-hwan of Daishin Securities stated, "Gradual recovery and improved profitability in the global segment are expected to drive earnings improvement."