"Domestic Inventory Clearance and Strong Overseas Business"... Lotte Wellfood's Q1 Operating Profit Doubles (Comprehensive)

373 Billion KRW on a Consolidated Basis... 100.6% Increase YoY
International Oil Price Stability Improves Profitability

Lotte Wellfood's operating profit in the first quarter of this year more than doubled compared to the same period last year, driven by improvements in domestic business activities and strong performance in global operations.

Lotte Wellfood Headquarters
[Photo by Lotte Wellfood]

Lotte Wellfood announced on the 3rd that its consolidated operating profit for the first quarter of this year was tentatively estimated at 37.3 billion KRW, a 100.6% increase compared to the same period last year. Sales decreased slightly by 0.9% to 951.1 billion KRW, but net profit surged significantly to 20.1 billion KRW.

A Lotte Wellfood official stated, "In the domestic business, profits increased due to the depletion of high-cost inventory, and in the global business, operations in India and Kazakhstan showed strong results." The company also explained that profitability improved as international oil prices stabilized.

Oil prices had previously surged due to supply shortages caused by the Russia-Ukraine war. The merger absorption of Lotte Food on July 1, 2022, which integrated businesses mainly focused on frozen desserts, is also considered one of the reasons for improved profitability.

By segment, domestic business sales recorded 764 billion KRW, down 1.7% year-on-year, while operating profit rose 112.1% to 27.2 billion KRW. Sales of gum, candy, and snacks increased, but sales of frozen desserts, oils, and food ingredients declined.

During the same period, global business sales increased by 3.3% to 197.2 billion KRW, and operating profit rose 60.9% to 14.3 billion KRW. Notably, sales of Choco Pie increased as production lines were expanded in India, although frozen dessert sales temporarily declined due to weather impacts.

Going forward, Lotte Wellfood plans to continuously launch new products in the domestic market that align with this year's 'Health and Wellness' trend, including sugar-free yogurt, plant-based snack brands, and the 'Soonhan' Uiseong brand.

In the global business, the company plans to expand its scale under the 'Lotte' brand. Next year, it will introduce a Pepero production line at its Indian subsidiary, Lotte India, and launch new Pig Bar products through its Indian frozen dessert subsidiary, Havmore.