Foreign Demand Soars: F&F Reports Strong Q1 Results [Click e-Stock]

Surging Sales at Major Foreigner Districts in Korea
Steady Growth Continues at Chinese Subsidiary

F&F delivered solid results in the first quarter of this year. Analysts note that the company is maintaining a stable growth trajectory, as its major brands are gaining popularity not only domestically but also among foreigners overseas.

On May 6, Mirae Asset Securities raised its target price for F&F by 17.6% to 100,000 won, citing these factors. The previous trading day's closing price was 20,250 won. The investment opinion of 'Buy' was also maintained.

F&F exceeded expectations in the first quarter of this year, reporting sales of 560.9 billion won and operating profit of 153.5 billion won, up 10.9% and 24.2%, respectively, compared to the same period last year. This strong performance was driven by robust foreign demand for its core brand, MLB.

MLB's domestic sales reached 64.4 billion won, marking a 15% increase year-on-year. Both strong domestic consumption and foreigner demand contributed positively. In particular, sales at major foreigner districts in Seoul—such as Myeongdong, Hannam, Seongsu, and Hongdae—as well as flagship stores, grew by over 70% compared to the previous year.

This strong foreign demand extended to China. The Chinese subsidiary posted sales of 303.1 billion won, growing about 17% year-on-year. Although the number of MLB stores is being reduced as part of an efficiency strategy, overall brand sales increased as store efficiency improved.

However, Discovery is experiencing a downturn. Sales came in at 86.1 billion won, down 2% from the same period last year. Nevertheless, the pace of decline is slowing. Given the favorable consumer environment, a significant slump is not expected in the near term.

This robust performance is expected to continue for the time being. The meaningful share and growth rate of foreign demand are particularly encouraging. Mirae Asset Securities researcher Song Bae-song commented, "Foreign demand is linked to caps, which are high-margin products, as well as the Chinese subsidiary, a high-margin channel. As foreign demand expands, earnings leverage will be maximized."

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