April 25, 2024

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[THE INVESTOR] Lotte Food’s earnings will recover this year, said IBK Securities on Jan. 12 maintaining its 750,000 won (US$703.83) target price. 

Its revenue from the fourth quarter last year climbed 2.9 percent on-year to 419.7 billion won while operating loss came in at 800 million won, the latter missing market consensus, said analyst Kim Tae-hyeon.

Its profitability was largely undermined by decline in formula milk exports to China and depreciation costs from expanding its plant in Pyeongtaek, Gyeonggi Province, explained the analyst. 

Prospects for this year, however, are brighter, noted Kim. Exports to China bottomed out in the second quarter last year and are picking up. Further, costs for facilities expansion since January 2017 will serve as a low baseline, he said maintaining a “buy” recommendation. 

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