Strong Performance in Overseas Markets Including China, Vietnam, and Russia
Korean Subsidiary's Operating Profit Grows Nearly 6%
Rigachem Acquisition Last Year Yields Visible Results
Orion surpassed operating profit of 500 billion KRW for the first time since its founding in 1956, setting a record high performance.
On the 11th, Orion announced that it recorded consolidated sales of 3.1043 trillion KRW and operating profit of 543.6 billion KRW in 2024. These figures represent increases of 6.6% and 10.4%, respectively, compared to the previous year.
An Orion official explained, "Despite the prolonged global economic recession and rising raw material costs such as cocoa and sugar, we achieved strong performance due to the robust business of overseas subsidiaries in China, Vietnam, Russia, and others." The stable cash-generating ability resulting from the strong performance further strengthened Orion's financial stability. As of December 31 last year, the group's net cash holdings amounted to 1.6 trillion KRW.
Looking at each subsidiary, the Korean subsidiary recorded sales of 1.0976 trillion KRW and operating profit of 178.5 billion KRW last year, growing 2.6% and 5.7% respectively compared to the previous year. Overseas dividend income of 237.8 billion KRW received from the China and Vietnam subsidiaries was reflected, resulting in a pre-tax net profit of 402.4 billion KRW.
The Korean subsidiary plans to focus on actively launching new products and developing niche markets by channel this year, anticipating that difficult conditions such as a strong exchange rate and economic recession will continue. In particular, it will seek steady growth opportunities through the development of high value-added products such as functional and premium items in response to market changes.
In response to the K-food wave, exports to the United States, China, Australia, Europe, and other regions will also be actively expanded. To this end, this year, the first groundbreaking will take place for the construction of an integrated production, packaging, and logistics center on approximately 180,000 square meters (about 56,000 pyeong) of land in the Jincheon Technopolis Industrial Complex in Jincheon, Chungcheongbuk-do. It is planned to be established as a forward base for expanding domestic and overseas supply volumes, including exports.
The China subsidiary recorded sales of 1.2701 trillion KRW, up 7.7%, and operating profit of 243.9 billion KRW, up 10.4%, as sales expanded in growth channels such as snack shops and bulk markets. With the completion of the indirect sales system last year, this year it is preparing for a second leap forward by launching highly competitive new products and strengthening the product power of existing products.
The Vietnam subsidiary achieved sales growth of 8.2% to 514.5 billion KRW and operating profit growth of 14.4% to 100.1 billion KRW, driven by active new product launches and increased sales of existing products such as gift pies and rice snacks An.
This year, following pies and fresh potato snacks, it plans to strengthen its dominance in the snack market by achieving the number one market share in rice snacks, while also expanding its bakery product line to further solidify its number one position in the market. To this end, the Vietnam subsidiary plans to complete the new construction and expansion of the Yen Phong factory in Hanoi in the first half of the year and expand the rice snack production line, as well as begin construction of a third factory that will house packaging lines and a logistics center.
The Russia subsidiary achieved sales growth of 15.1% to 230.5 billion KRW and operating profit growth of 15% to 36.9 billion KRW through increased production and expanded customer base. In ruble terms, sales and operating profit increased by 20.7% and 20.4%, respectively, continuing double-digit growth for six consecutive years.
This year, it plans to maintain high growth by establishing a multi-product system with new products tailored to local consumers' tastes and continuously expanding dealers and customers. As of December last year, the operating rates of the Tver new factory and Novo factory exceeded 128%, reflecting continued local demand growth, and plans are underway to build an additional factory building in Tver.
The India subsidiary plans to expand sales by increasing product supply mainly to traditional retail stores in the northeastern region and launching a 20-rupee product.
In March last year, Orion acquired the global pharmaceutical company Rigachem Biosciences, laying the foundation for the group's sustainable growth from a long-term perspective. In the first year after the acquisition, Rigachem achieved visible results, including signing a technology export contract worth about 1 trillion KRW with Japan's Ono Pharmaceutical.
This year, Orion plans to accelerate the development of new pipelines, continue technology exports, and strengthen global in-house clinical capabilities. With differentiated technology securing global competitiveness in the ADC field, which is attracting worldwide attention, growth as a leading Korean big biotech company is expected.
Meanwhile, on the 11th, Orion decided through a board resolution to double the dividend per share of the operating company Orion from 1,250 KRW to 2,500 KRW. This corresponds to about 26% of the consolidated controlling interest net profit (excluding one-time non-recurring gains).
Orion had previously announced a dividend policy in April last year to increase the dividend payout ratio to more than 20% of consolidated controlling interest net profit over the next three years as part of its shareholder return policy.
Orion's consolidated net profit was 533.2 billion KRW, the highest ever. This included 143.7 billion KRW from non-recurring gains such as stock valuation gains due to the difference between the contract amount and the stock price on the acquisition day of Rigachem last year.
The holding company Orion Holdings increased its dividend from 750 KRW to 800 KRW. The dividend yield is about 5%, higher than the market interest rate in the 3% range. The dividend record date for Orion and Orion Holdings is February 28, 2025.
An Orion official said, "As a global company with overseas sales accounting for 65% as of 2024, we will continuously strengthen the market dominance of overseas subsidiaries and increase the overseas proportion through export expansion."
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