Impact of Logistics and Manufacturing Infrastructure Investment: CJ Freshway's 2Q Operating Profit Down 7.4% YoY (Comprehensive)

Sales of 779.5 Billion KRW and Operating Profit of 32.1 Billion KRW Recorded
Group Catering Achieves Highest Quarterly Sales Ever

CJ Freshway continued its external growth in the second quarter of this year by expanding both the number of customers and sales per customer, but operating profit slightly decreased due to investments in logistics and manufacturing infrastructure.

CJ Freshway announced on the 9th that its consolidated operating profit for the second quarter of this year was tentatively estimated at 32.06 billion KRW, down 7.4% compared to the same period last year. During the same period, sales increased by 8.1% to 779.492 billion KRW, while net profit decreased by 14.6% to 20.71 billion KRW.

Sales in the food ingredient distribution business reached 579.2 billion KRW, up 4.2% compared to the same period last year. In the dining-out channel, the number of client companies exceeded 11,000 by steadily securing new customers such as ‘Five Guys,’ and the sales per customer increased by 15% year-on-year as of the first half. This was thanks to actively implementing the ‘Dining-Out Solution,’ which provides step-by-step consulting from startup to maturity stages to enhance market competitiveness despite the dining-out recession. In the catering channel, the expansion of sales of differentiated products such as private brands (PB) and exclusive products contributed to the performance. In particular, PB sales including Ainuri (kids’ food ingredients), Ttuntun School (school meals), and Healthy Nuri (care food) increased by 16% year-on-year as of the first half.

Sales in the group catering business recorded 184.1 billion KRW, setting a record for the highest quarterly sales ever. This figure represents a 24.8% increase compared to the same period last year. The sales increase in this channel was highest at 36%, resulting from focusing on securing orders from industrial and office stores with stable water supply. In addition, all other channels such as hospitals, leisure and concession stores also grew steadily, and diversification of revenue streams through ready-to-eat corners and cafes contributed to the performance.

Sales in the manufacturing business were 16.2 billion KRW, down 6.8% compared to the same period last year. This was due to a temporary decrease in purchase volumes from some food manufacturers. To increase sales, the manufacturing subsidiary Fresh Plus is strengthening its lineup of high-growth sauces and semi- and ready-to-cook products.

A CJ Freshway official said, "Despite the difficult business environment, we achieved meaningful results by growing together with our customers," adding, "Along with continuous improvement of our financial structure, we will secure a super-gap capability through future strategy initiatives such as IT, research and development (R&D), and marketing."

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