[Click eStock] "Cheil Worldwide Achieves Record High 3Q Operating Profit, High Growth in North America"

Digital Business Share Already Approaching 50%... "New Growth Engines Secured"

[Asia Economy Reporter Minwoo Lee] Cheil Worldwide recorded its highest-ever operating profit for the third quarter. With the global advertising market continuing to recover, rapid growth is expected especially in North America.

On the 29th, Korea Investment & Securities raised Cheil Worldwide's target stock price by 14.8% to 31,000 KRW and maintained a 'Buy' rating, citing this background. The closing price the previous day was 24,100 KRW.

Cheil Worldwide posted a consolidated gross profit of 325.8 billion KRW and an operating profit of 70.2 billion KRW for the third quarter this year. These figures represent increases of 17% and 18%, respectively, compared to the same period last year. The operating profit also exceeded market consensus estimates by 4.3%, setting a new record for the third quarter.

Domestic gross profit was recorded at 87 billion KRW, up about 9% year-on-year, driven by Samsung Electronics' launch of new foldable phones and an increase in digital advertising volume. Overseas gross profit reached 238.8 billion KRW, a 20% increase over the same period, due to high growth in North America and a rebound in the European advertising market.

Researcher Taewan Oh of Korea Investment & Securities explained, "The recovery of the European advertising market alongside the with-COVID policy is positive, and growth in China, Southeast Asia, and South Asia is also continuing. Cheil Worldwide expects growth to continue for several years considering Samsung Electronics' North American sales."

The digital business proportion rose from 43% last year to 50% cumulatively in the third quarter this year. Despite a slowdown in advertising spending by B2C companies due to global supply chain disruptions, it is analyzed that profit growth will continue based on digital capabilities. Researcher Oh said, "Cheil Worldwide secured digital capabilities through its dot-com business and demonstrated digital advertising capabilities after COVID-19, successfully establishing itself in a growing sector. Their efforts to secure advertising capabilities on metaverse (extended virtual world) platforms are also positive."

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