April 19, 2024

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[THE INVESTOR] Shinsegae Food’s earnings have been solid in the second quarter, said Samsung Securities on July 21, maintaining a “buy” recommendation and 195,000 won (US$173.60) target price. 

Its revenue hit a record 303 billion won and operating profit was 8.5 billion won, up 16.2 percent and 6.3 percent on-year, respectively, estimated analyst Cho Sang-hun. 

The manufacturing and distribution sectors secured new clients while subsidiaries, including mineral water company J One, posted decent earnings, explained the analyst. 

As it has closed down loss-making diners and operation ratio of factory in Eumseong has stabilized, revenue from food processing rose but operating profit could not keep up with the upturn burdened by initial costs to attract new clients and other one-off costs, noted Cho. 

Operating profit for the whole year will hike 45.2 percent to 31 billion won from a year ago, bolstered by company-wide balanced growth, and partnering with PyeongChang Olympics Committee for catering service also will be favorable, added the analyst. 

By Hwang You-mee (glamazon@heraldcorp.com)