[Click eStock] "Kyochon F&B, 3Q Earnings Turnaround... Next Year to Be the Largest Ever"

Q3 Revenue of 121.5 Billion KRW, Operating Profit Expected at 8.5 Billion KRW
Seasonal Peak and Stable Cost Ratio Likely to Drive Performance
Continued Growth Expected Through Overseas Business Expansion and Brand Extension

IBK Investment & Securities forecasted on the 22nd that Kyochon F&B's 2023 third-quarter performance will mark a turnaround, and next year's results will reach an all-time high. They maintained a 'Buy' investment rating and a target price of 12,500 KRW. Kyochon F&B's closing price on the previous trading day was 8,780 KRW.

According to IBK Investment & Securities, Kyochon F&B is expected to achieve a turnaround in its 2023 third-quarter results. On a consolidated basis, sales are projected to reach 121.5 billion KRW, a 9.0% increase compared to the same period last year, while operating profit is estimated at 8.5 billion KRW, a 0.6% decrease year-over-year. Although there will be a temporary reflection of costs related to the conversion to franchise regional headquarters for distribution network efficiency, overall operating performance is expected to remain similar to last year. One-time expenses for the third quarter are estimated at approximately 7 billion KRW.

Nam Seong-hyun, a researcher at IBK Investment & Securities, stated, "The reasons for the expected positive performance include ▲ seasonal peak demand and growth driven by sports events ▲ stable cost ratio ▲ expanded sales and profit contribution due to the conversion to franchise regional headquarters ▲ and the gradual recovery of previously decreased chicken demand." The third-quarter gross profit margin is expected to exceed 30%, with further improvement anticipated in the fourth quarter.

In 2025, the company is expected to record its highest-ever performance. Sales and operating profit are estimated at 500.5 billion KRW (a 7.2% increase year-over-year) and 55.13 billion KRW (a 134.1% increase year-over-year), respectively. The reasons for expecting performance growth include the completion of the franchise regional headquarters conversion leading to improved distribution structure, profitability improvements from logistics and inefficiency elimination, and positive effects from new product launches and new businesses.

Kyochon F&B plans to build continuous growth momentum through expanding its overseas business division and broadening its brand and business areas. In this process, securing substantial profit-generating capabilities is expected to act as a positive factor.

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