Cheil Worldwide Reports 54.5 Billion KRW Operating Profit in 1Q, Up 2.1% YoY

Performance Defense Amid Olympic Project Increase

Cheil Worldwide announced on the 26th that its consolidated operating profit for the first quarter of this year was tentatively estimated at 54.543 billion KRW, a 2.1% increase compared to the same period last year.

During the same period, sales increased by 8.11% to 1.018 trillion KRW, and net profit rose by 5.01% to 43.439 billion KRW. Gross profit, calculated by subtracting cost of sales from sales revenue, reached 390.7 billion KRW, a 7% increase compared to the same period last year.

Cheil Worldwide CI. [Image provided by Cheil Worldwide]

Cheil Worldwide emphasized that both its headquarters and consolidated subsidiaries experienced growth in gross profit compared to the same period last year. The headquarters recorded a 6% increase in first-quarter gross profit to 390.7 billion KRW, while consolidated subsidiaries posted an 8% increase to 315 billion KRW in gross profit. Cheil Worldwide explained, "despite major advertisers reducing media-centered advertising expenses, performance was defended mainly by non-affiliated sectors such as finance, telecommunications, and food and beverage."

By service category, the digital sector expanded while non-media advertising (BTL) volume increased through promotions and other activities. In the first quarter, Cheil Worldwide's business composition by service was ▲Digital 54% ▲BTL (promotion, retail, etc.) 33% ▲Traditional advertising (ATL) 13%. Compared to last year's business composition, the share of ATL decreased while BTL increased. Regarding this, Cheil Worldwide explained that BTL grew by 14% year-on-year due to an increase in Olympic-related programs.

Performance from advertisers outside the Samsung group also increased by 10% compared to the same period last year. This was attributed to the development of new advertisers in growth sectors such as health functional foods and healthcare, as well as handling global agency services for domestic advertisers. Cheil Worldwide headquarters secured advertising agency contracts with Kenview, Krafton, Netflix, and Dunamu.

Cheil Worldwide set its management goals for this year as ▲annual growth of over 5% in gross profit ▲and defending profitability. To achieve this, the company plans to minimize the impact of external uncertainties by expanding its digital business and non-affiliated advertisers. Additionally, it aims to strengthen a business foundation capable of sustainable growth.