Operating Profit Reaches 1.0323 Trillion Won Excluding CJ Logistics, Up 26%
Strong Sales Maintained Despite Domestic Consumption Slump Thanks to Direct Transactions with Coupang
Accelerating Global Expansion This Year with Domestic Mega-Hit Products
CJ CheilJedang has recovered its operating profit to the 1 trillion won level after one year amid a severe domestic demand slump. This was thanks to compensating for the sluggish domestic food business through the expansion of new K-food territories and significant improvement in the profitability of the bio business. CJ CheilJedang plans to accelerate global business expansion this year as well, leveraging domestic mega-hit products.
CJ CheilJedang announced on the 10th that its fourth-quarter performance last year, excluding CJ Logistics, achieved sales of 4.475 trillion won and operating profit of 219.9 billion won. Operating profit increased by 39.2% compared to the previous year. As a result, CJ CheilJedang recorded annual sales of 17.871 trillion won and operating profit of 1.0323 trillion won last year. Operating profit increased by 26% compared to the previous year, recovering to the 1 trillion won level after one year. Sales decreased by 0.1%.
By business segment, the core food division saw a noticeable deterioration in profitability. Sales reached 11.353 trillion won, up 0.8% year-on-year, but operating profit decreased by 5.3% to 620.1 billion won. Domestic business sales were 5.7716 trillion won, down 1.8% year-on-year. Consumption sluggishness continued due to the domestic demand slump. However, steady growth of key processed foods such as Hetbahn and the resumption of direct transactions with Coupang partially offset the business downturn.
Overseas food business recorded sales of 5.5814 trillion won, a 3.6% increase from the previous year. As a result, overseas food sales accounted for 49.2% of total food sales. A CJ CheilJedang official explained, "Last year's focus on 'K-food new territory expansion' achieved results at an all-time high level." CJ CheilJedang continued growth in key regions such as North America, Europe, and Australia, with overseas sales of global strategic products such as kimchi (+38%), frozen rice (+22%), and dumplings (+18%) increasing significantly.
By region, North America recorded sales of 4.7138 trillion won. Bibigo dumplings, the No. 1 brand in the North American market, maintained a lead more than three times that of the second-ranked brand, and Schwan’s flagship pizza brand ‘Red Baron’ further solidified its top position. Notably, Europe surpassed 100 billion won in annual sales for the first time. Accelerated entry into new countries such as France and Spain, along with expanded product sales in major European distribution channels, contributed to this achievement. In Australia, following Woolworths, CJ CheilJedang succeeded in entering Coles and IGA, establishing a foundation to sell Bibigo products in 80% of major local retail stores.
Despite the food business downturn, overall profitability improved thanks to the bio business division. The bio business recorded sales of 4.2095 trillion won and operating profit of 337.6 billion won last year. While sales were similar to the previous year, operating profit rose by 34.3%. The expansion of sales of high-margin products such as tryptophan and increased sales of specialty items led to improved profitability. In particular, the sales proportion of specialty products, which are high value-added items such as arginine, valine, isoleucine, and histidine, reached an all-time high of 21% on an annual basis. ‘Taste Enrich,’ leading the premium seasoning market, drove specialty product growth by securing new customers such as global alternative meat and seasoning material manufacturers.
The feed and livestock independent corporation CJ Feed&Care recorded sales of 2.3085 trillion won and operating profit of 74.7 billion won. The rise in livestock prices in major business countries such as Indonesia and Vietnam, along with efforts to stabilize manufacturing costs through productivity improvements, led to a turnaround to annual operating profit surplus.
CJ CheilJedang plans to expand the overseas entry of domestic ‘mega-hit products’ such as ‘Sobaba Chicken’ and ‘Whole Shrimp Dumplings.’ In the mid to long term, it aims to accelerate K-food territory expansion through the new North American Asian food factory located in Sioux Falls, South Dakota, scheduled to start operations in 2027, and the European factory in Hungary, scheduled to start operations next year. The bio business division will continue to expand sales of tryptophan and specialty products. In particular, as lysine prices, which had fallen due to low-price competition from Chinese companies for several years, are rapidly rebounding in the global market due to the EU’s anti-dumping duties, CJ CheilJedang aims to respond quickly to market changes.
A CJ CheilJedang official stated, “Based on the OnlyOne spirit, we will further accelerate global business expansion and quickly secure innovative growth engines that will lead future food sources.”
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