Lotte Wellfood (280360) Q2 2025 earnings summary

Executive summary

• Q2 consolidated sales rose 1.9% YoY to KRW 1,064.281bn; operating income fell 45.8% to KRW 34.334bn and net income fell 61.5% to KRW 15.678bn.

• Excluding one-time items, Q2 operating income was KRW 45.5bn, down 28.1%; H1 sales rose 2.2% to KRW 2,039.4bn, while operating income fell 49.6% to KRW 50.7bn.

Financial highlights

• Q2 gross profit was KRW 304.9bn, down 6.8% YoY; gross margin was 28.6%, versus 31.3%, and ordinary profit fell 57.0% to KRW 25.3bn.

• H1 consolidated gross profit was KRW 558,238m versus KRW 604,367m; SG&A expenses were KRW 507,518m versus KRW 503,742m.

• H1 separate revenue was KRW 1,589,325m, operating income KRW 35,670m and net income KRW 20,235m; basic and diluted EPS were KRW 4,674.

Outlook and guidance

• FY2025 sales growth guidance is 4–6% overall, comprising 2–4% domestic and 12–14% global growth; operating margin targets are 4.5–5.5% overall, 4.0% domestic and 8.0–9.0% global.

• Priorities include domestic high-margin core products and portfolio diversification, global expansion and exports, production and logistics efficiency, and Health & Wellness and meal-replacement products.

• H1 R&D spending was KRW 14,625m, or 0.72% of revenue; development includes lower-sugar, plant-based, high-protein and convenient meal products.