Redcap Tour Achieves Record Operating Profit of 17.9 Billion Won in Q1, Highest Since Founding

Redcap Tour achieved its highest-ever quarterly operating profit in the first quarter of this year. The company’s stable business structure, centered on corporate and public institutions, as well as its profitability-focused management strategy, have been credited for driving improved results.

On May 8, Redcap Tour announced through a regulatory filing that its consolidated sales for the first quarter reached 92.4 billion won, with operating profit at 17.9 billion won. Compared to the same period last year, sales decreased by 12.3%, but operating profit increased by 0.4%. Notably, operating profit reached a record high for a single quarter.

However, excluding the one-off sales of 14.6 billion won and operating profit of 8.3 billion won generated from the sale of the Jeju short-term rental car business in the first quarter of last year, this year’s first-quarter sales also showed an increase. During the same period, recurring profit reached 14.2 billion won and net profit was 10.9 billion won, up 4.2% and 2.8%, respectively. Compared to the previous quarter (the fourth quarter of last year), sales rose by 20.6% and operating profit increased by 251.5%.

The company explained that despite external uncertainties caused by the Middle East war, it maintained stable results by focusing on a strategy centered on corporate (B2B) and government/public institution (B2G) clients and strengthening profitability.

The rental car business segment recorded first-quarter sales of 81.3 billion won and operating profit of 15.1 billion won. While these figures decreased year-on-year, excluding the one-off results from the sale of the Jeju short-term rental car business last year, sales increased by 1.1% and operating profit surged by 90.5%. The operating margin stood at 18.6%, up 1.5 percentage points year-on-year.

This improvement in profitability is seen as a result of business structure reorganization. Redcap Tour integrated its existing rental car and travel business units around client needs and established a new sales team dedicated to expanding B2B and B2G transactions. Additionally, the company maximized profits by strategically selling vehicles whose contracts had expired.

The proportion of eco-friendly vehicles is also expanding. With high oil prices driving up demand for electric and hybrid vehicles, the share of eco-friendly vehicles climbed to 48% by the end of the first quarter this year. In particular, demand for electric vehicles from public institutions is seen as a major driver of performance growth. The company plans to continue targeting the eco-friendly vehicle market, while providing differentiated services such as the RMS (Redcap Mobility Service) for integrated corporate vehicle mobility and the electric vehicle battery management solution ‘B-Lifecare’.

The travel business segment also continued its growth trajectory. First-quarter sales were tallied at 11 billion won, with operating profit at 2.8 billion won, representing increases of 7.7% and 70.5%, respectively, compared to the same period last year. The operating margin rose to 25.7%, up 9.5 percentage points year-on-year.

Although some events were canceled due to the aftermath of the Middle East war, increased business travel demand from major clients, as well as the expansion of global events such as CES and MWC, contributed positively to results. Furthermore, the effect of client transfer is now materializing, as AMEX GBT (Global Business Travel), a strategic partner, unified its domestic partnership with Redcap Tour last year.

Redcap Tour is securing differentiated competitiveness over ordinary online travel agencies (OTAs) by providing customized consulting services that reflect the business travel policies of corporations and public institutions. Overseas business travel demand from key clients is also expected to continue rising, driven by the expansion of production lines in the United States by electric vehicle and secondary battery companies, the spread of K-culture, and improvements in the semiconductor industry.

Yoo Sung In, CEO of Redcap Tour, said, “Despite uncertainties stemming from the Middle East war, we have achieved stable results through a B2B and B2G-focused business strategy and efforts to enhance profitability. Going forward, we will strengthen customer-centric management and performance management systems to secure differentiated competitiveness.” He added, “We will also actively promote ESG management and shareholder-friendly policies to enhance corporate value.”

Redcap Tour is simultaneously strengthening both profitability and growth, leveraging its stable business structure centered on corporations and public institutions, as well as the expanding demand for eco-friendly vehicles and business travel.

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