Orion Achieves Record-High First Half Performance... Growth Across All Overseas Subsidiaries

Sales Revenue and Operating Profit of 1.2805 Trillion KRW and 198.3 Billion KRW... Up 16% and 26% YoY

[Asia Economy Reporter Eunmo Koo] Orion recorded its highest-ever performance in the first half of this year.

Orion Group announced on the 16th through a public disclosure that its business company Orion posted consolidated sales of 1.2805 trillion KRW in the first half of this year, a 16.0% increase compared to the same period last year. Operating profit also grew by 26.3% to 198.3 billion KRW during the same period.

The Korean corporation recorded sales of 447.9 billion KRW, up 13.7%, and operating profit of 69.6 billion KRW, up 5.3%. Growth was driven by significant increases in sales of pies and biscuits, based on an aggressive market share expansion strategy and price competitiveness. With the continued growth of the convenient meal replacement category and health trends, sales of the Market O Nature and Dr. You brands grew by 35% and 15%, respectively, compared to the same period last year.

The jelly category also saw a 34% increase in sales, boosted by new products such as ‘My Gummy Almaengi.’ The beverage business, including ‘Dr. You Jeju Lava Water,’ continued its growth by actively expanding sales channels. Despite a more than 4 percentage point increase in manufacturing cost ratio compared to the same period last year due to rising raw material and energy costs, the company succeeded in defending profitability through company-wide cost management efforts.

In the second half, Orion plans to continue expanding market share by launching differentiated products such as pies, snacks, and biscuits. Additionally, it will sustain growth in the convenient meal replacement category through various new granola products tailored to consumer tastes and lifestyles. ‘Dr. You Jeju Lava Water’ and ‘Dr. You Immunity Water’ will also expand consumer touchpoints while actively increasing exports overseas.

The Chinese corporation posted sales of 568.4 billion KRW, up 8.9%, and operating profit of 85.2 billion KRW, up 42.7%, benefiting from the base effect following somewhat sluggish performance last year. After the easing of lockdown measures in major cities in May, it focused on business activities and maintained growth. It introduced competitive limited-edition new products such as ‘Choco Pie Watermelon Flavor’ and actively targeted the new O2O (online-to-offline) distribution platform while expanding general retail store accounts, laying a foundation for growth. Operating profit also grew as the company lowered cost ratios by diversifying raw material suppliers and adopted a product-focused strategy that avoided excessive cost-incurring promotions.

In the second half, Orion will expand sales based on price competitiveness in key categories such as snacks and pies. In the third quarter, it will focus on differentiation from competitors by launching new products like ‘Poca Chip’ and ‘Kkobuk Chip’ to target the snack peak season. In the fourth quarter, it plans to expand its lineup of mass-produced bread such as ‘Songsong Low Songdanga’ to coincide with the pie peak season in winter. It will also actively promote holiday marketing activities by preparing pie promotional products for the Mid-Autumn Festival in September and the Lunar New Year in January next year. Sales capabilities will be significantly strengthened by focusing on developing small and medium-sized businesses and expanding accounts, while concentrating on the southern region snack market.

The Vietnamese corporation recorded sales of 195.7 billion KRW, up 34.4%, and operating profit of 33.1 billion KRW, up 40.8%. It continued strong sales growth by implementing a product-centered strategy, launching new products across all categories. In particular, mass-produced bread ‘Sebong’ led the meal replacement market, and the rice snack category supported growth by achieving a 26% market share. A virtuous cycle was established where increased sales maximized profits within an optimized cost structure, and the product-focused strategy created synergy, sustaining significant profit growth.

In the second half, aggressive sales strategies such as expanding snack-exclusive displays will further widen the market share gap with global competitors. Orion plans to enter the new layer cake category as a new growth engine following rice snacks and mass-produced bread. Additionally, in the jelly category, which was newly entered last year with the launch of ‘Boom Jelly,’ the company will continue high growth by introducing new formulations and flavors.

The Russian corporation achieved sales of 78.8 billion KRW, up 55.7%, and operating profit of 11.6 billion KRW, up 54.0%, recording the highest growth among all Orion subsidiaries and beginning a second leap forward. The main brand Choco Pie’s new lineup grew significantly, and new biscuit products such as ‘Crack It’ and ‘Mr. Bagetti’ gained popularity among local consumers, driving high growth. From April, the effect of price increases supported profit growth. In the second half, Orion plans to fully operate the new Tver factory to increase production of existing pie products, introduce new products in the biscuit category, and focus on expanding dealers and accounts to grow its scale.

An Orion official said, “Despite a difficult business environment with ongoing economic recession and global uncertainties, all subsidiaries achieved strong sales and operating profit by actively implementing sales strategies centered on new products and focusing on cost efficiency. In the second half, we will strengthen competitiveness through differentiated new product launches and entry into new categories, while thoroughly managing costs to simultaneously pursue external growth and profitability improvement.”