Operating Profit of KRW 131.4 Billion,
Revenue of KRW 801.8 Billion
Orion reported solid results, driven by the growth of its overseas subsidiaries.
On May 15, Orion announced that its consolidated operating profit for the first quarter of this year reached KRW 131.4 billion, marking a 5% increase compared to the same period last year. During the same period, revenue rose by 7.1% to KRW 801.8 billion, while net profit increased by 6.3% to KRW 106.1 billion.
Orion explained, "Despite the ongoing global economic downturn and weakened consumer sentiment, and even though the impact of 'Chunjie' and 'Tet'?the peak seasons in China and Vietnam?was reduced, our global subsidiaries in China, Vietnam, and Russia continued to deliver robust growth. In addition, export volumes from the Korean subsidiary increased significantly, resulting in overseas sales accounting for 68% of total revenue."
By subsidiary, the Korean subsidiary recorded revenue of KRW 282.4 billion, up 4%, and operating profit of KRW 46.3 billion, up 5.6%. Domestic sales grew by 1.6% as domestic consumption remained sluggish and retail clients such as supermarkets continued to close. However, exports?mainly to the United States?increased by 23%, driving the growth of the Korean subsidiary. Operating profit also rose, supported by expanded export volumes and internal efforts to reduce costs.
The Chinese subsidiary posted revenue of KRW 328.2 billion, up 7.1%, as sales expanded through high-growth channels such as snack shops and e-commerce, even though Chunjie results were reflected in the fourth quarter of last year. Combined revenue for the four months from November of the previous year through February of this year, which reflects the Chunjie season, also increased by 13.5%. Operating profit rose by 3.2% to KRW 56 billion, despite continued cost pressures from rising prices of key raw materials such as cocoa and oils and fats.
The Vietnamese subsidiary achieved revenue of KRW 128.3 billion, up 8.5%, and combined revenue for the Tet season (from November of the previous year through February of this year) also increased by 11.2%. Operating profit rose by 9.2% to KRW 21.2 billion, in line with revenue growth.
The Russian subsidiary saw revenue grow by 33% to KRW 67.2 billion, as supply to major sales channels, including the largest local distributor X5 and Tender, expanded while the Choco Pie production line operated at over 140% capacity. Operating profit increased by 9.2% to KRW 8.6 billion, despite higher manufacturing costs due to rising prices of major raw materials such as cocoa and whole milk powder and the impact of exchange rates.
Ligachem Bioscience, an affiliate acquired in March last year, recorded net profit of KRW 26.5 billion, up 181%, after adding Ono Pharmaceutical as a new technology transfer partner in October. As a result, equity method gains of KRW 5.2 billion were reflected.
Meanwhile, Orion Holdings saw its dividend income increase after Orion, its operating company, doubled its dividend payout from KRW 1,250 to KRW 2,500 per share at the shareholders' meeting in March this year. Royalty income also rose thanks to strong performances by Orion's overseas subsidiaries in China, Vietnam, and Russia, resulting in operating profit surging by 134% to KRW 46.8 billion.
An Orion official stated, "We will continue to steadily expand our domestic and overseas supply capacity and strengthen the product and sales capabilities of all subsidiaries, further enhancing our leadership in the global market."
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