April 27, 2024

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[THE INVESTOR] SPC Samlip’s foodstuff sector is struggling longer than expected, said Samsung Securities on March 9, lowering the target price to 160,000 won (US$149.77) from 170,000 won.

Its revenue in the fourth quarter last year fell 3.2 percent on-year to 513.3 billion won and operating profit by 20.6 percent to 17.7 billion won, the latter was 16 percent below market consensus, said analyst Cho Sang-hun.

Its operating profit has been declining for seven consecutive quarters and slow foodstuff business is the main reason for the disappointing results, explained the analyst. 

This year, though, it may able to improve its profits by raising the price of foodstuff as well as the margin rates in food distribution. The growth momentum from expansion in dining and overseas market is still valid, said Cho maintaining a “buy” recommendation. 

The new B2C business based in the new factory in Cheongju, North Chungcheong Province, could propel improvement in profits across the company, he added. 

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