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South Korean food companies see massive sales growth

Korean snack

South Korean food companies scored massive sales growth in the wake of the COVID-19 pandemic, as the demands increased for products that can be consumed at home, in both domestic and overseas markets.

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In the second quarter this year, CJ CheilJedang recorded an operating profit of US$324 million, up 119.5 percent from the same time last year. The figure is the biggest quarterly figure recorded for the company.

Its sales stood at US$5.8 billion, increasing by 7.4 percent on-year, with the net profit soaring 300.1 percent to land at US$133 million.

CJ CheilJedang attributed to the increased sales in its ready-made products and also overseas sales for its performance. According to the company, its sales went up 19 percent in the United States, 24 percent in Vietnam and 35 percent in China.

Orion, a Korean snacks company, also witnessed a record-high operating profit in the first half of this year, of US$154 million, up 43.5 percent on-year. The sales stood at US$434 million, increasing by 17.3 percent.

The company also did well overseas, witnessing a growth rate of 17 percent in operating profit of overseas branches in countries including China, Vietnam and Russia, Orion said.

The sales for Dongwon Industries also jumped by 7.7 percent to US$607 million in the second quarter of this year compared to the same period last year, and the operating profit recorded US$75.7 million, up 55.4 percent.

The company’s performance appears to have been propelled by its US-based subsidiary StarKist, which specializes in canned tuna products.

Daesang’s operating profit grew 80.5 percent in the second quarter this year from a year earlier to stand at US$51.4 million, and sales increased by 6.9 percent to US$659 million.

Instant noodle companies also benefited, posting record profits, as more people sought convenient meals at home.

Nongshim’s operating profit soared to show a growth rate of 404.8 percent to reach US$34 million in the second quarter this year. As for sales, the company recorded US$563 million, up 17.6 percent.

According to the company, the overall operating profit in the first half of 2020 was US$88 million, soaring 163.7 percent on-year. The domestic sales increased by 12.2 percent, and overseas sales, 34.3 percent.

Nongshim explained that the exposure of its Chapagetti and Neoguri noodles in the award-winning movie “Parasite” also played a role in enhancing its performance, in addition to the pandemic.

Samyang Foods, which produces the globally popular Buldak Spicy Chicken noodles, said it posted a record-high performance in the second quarter this year, with its operating profit standing at US$24 million, up 41 percent on-year. The sales also grew by 30 percent to reach US$146 million won.

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The company said its quarterly overseas sales surpassed US$84 million for the first time, at US$91.8 million, growing 56 percent on-year.

(Source: Korea Herald)

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