[Click eStock] CJ Freshway, Expansion of Group Meal Contracts and Performance Growth Trend

Hyundai Motor Securities forecasted on the 24th that CJ Freshway will continue its trend of expanding group meal service orders and achieving performance growth. Unlike in the past, the company has been maintaining profitability-focused management, continuously improving its profit resilience. Additionally, the repayment of 70 billion KRW in corporate bonds in January 2023 and active efforts to improve the financial structure this year were viewed as positive factors. However, no investment opinion or target stock price was provided.

Last year, on a consolidated basis, sales reached 2.7747 trillion KRW (a 19.9% increase), and operating profit was 97.8 billion KRW (a 75.8% increase). This was attributed to the improvement in the dining-out market following the reopening and an increase in new group meal service orders. In particular, although the consolidated operating profit in the fourth quarter fell short of market consensus, this was due to one-time factors such as incentives from strong performance and initial operating costs of the Dongtan logistics center opened in the third quarter.

Heeji Ha, a researcher at Hyundai Motor Securities, stated, "Despite a somewhat slowing dining-out market amid inflation in 2023, group meal demand is actually increasing, leading to expectations for growth in food material distribution for meal services and group meal sales." She added, "With the continuous high-profit path, customer acquisition, and the elimination of one-time selling and administrative expenses reflected in the fourth quarter as well as one-time non-operating gains and losses from subsidiary mergers, the performance improvement trend is expected to continue."

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