Lotte Chilsung Beverage (005300) Q1 2025 earnings summary

Executive summary

• Q1 2025 consolidated sales declined 2.8% year-over-year to KRW 910.3 billion, with operating profit down 31.9% and net profit down 66.4%.

• Beverage and liquor segments both saw sales and profit declines, but the liquor segment showed improved profitability and the beverage segment remained the largest contributor.

• Overseas business posted sales growth but lower operating margins, with PCPPI (Philippines) revenue at KRW 254.2 billion.

• Continued focus on zero-calorie and health-oriented products, with new launches planned for both beverage and liquor categories.

Financial highlights

• Q1 2025 consolidated revenue: KRW 910.3 billion (down from KRW 936.9 billion YoY); operating profit: KRW 25.0 billion (down from KRW 36.8 billion YoY).

• Net profit attributable to owners: KRW 7.0 billion (down from KRW 17.6 billion YoY); overall net profit: KRW 5.4 billion.

• Gross profit margin decreased from 33.8% to 32.4% year-over-year.

• Basic EPS: KRW 697 (down from KRW 1,748 YoY).

• Cash and cash equivalents at period end: KRW 277.7 billion; current assets rose 12.3% sequentially.

Outlook and guidance

• Full-year 2025 consolidated sales projected to rise 7.1% to KRW 4.31 trillion, with operating profit up 29.8% to KRW 240.0 billion.

• Beverage and liquor sales expected to grow 2.1% and 2.7% respectively, with overseas sales up 16.5%.

• Targeting a 30% shareholder return ratio on a consolidated basis by 2028, with plans for interim dividends and potential share buybacks.

• Continued expansion in overseas markets, especially for zero-calorie and health-focused products.

• New product launches and flavor revamps planned for key brands in 2025.