CJ ENM Commerce Division Q3 Operating Profit Up 44%... Food, Living, and PB Key Drivers

Sales Up 2.5% Year-on-Year
Untact Product Lines Fully Displayed Amid COVID-19
PB Brands Like The Edge and Odense Prove 'Cash Cows'

[Asia Economy Reporter Minyoung Cha] CJ ENM announced on the 5th that its consolidated operating profit for the third quarter was preliminarily estimated at 71 billion KRW, a 17.9% increase compared to the same period last year. Sales for the same period recorded 798.6 billion KRW.

Operating profit in the commerce sector, including CJ O Shopping, was recorded at 42.4 billion KRW, a 44.2% increase compared to the same period last year. Sales amounted to 344.3 billion KRW, a 2.5% increase from 335.8 billion KRW in the same period last year.

This was due to focusing on non-face-to-face (untact) demand product categories such as food, living, and infant and child products in response to the COVID-19 situation. In fact, the product portfolio for the third quarter was weighted with food and household goods (36.6%), followed by clothing (20.0%), beauty and cosmetics (17.1%), fashion accessories (7.6%), and interior (5.8%).

Additionally, the handling volume of private brands (PB) such as 'The Edge', 'Odense', and 'Secret' increased by 12.8% compared to the same period last year, and their share of handling volume reached 11.7%. It is analyzed that profitability was improved mainly through high-margin products.

By channel, strengthening digital sales centered on mobile led the performance improvement. In fact, digital sector sales increased by 24.7% to 155.2 billion KRW, offsetting the decline in TV sector sales (-21.2%). Sales in other sectors amounted to 148.2 billion KRW, down about 7% compared to before.

In the fourth quarter, the company plans to strengthen the product portfolio focusing on fashion, living, and home appliances and increase private brands. Mobile platforms such as 'Flagship Store' and 'Shock Live' will be completely revamped, and digital-exclusive products will also be expanded. The advancement of commerce data technology will also be promoted.

Meanwhile, the media sector recorded sales of 370.6 billion KRW and operating profit of 29.3 billion KRW, while the film sector posted sales of 36.9 billion KRW and an operating loss of 4.1 billion KRW.

This content was produced with the assistance of AI translation services.