Hybe, CJ ENM deliver strong quarterly results in Q3 on Korean content boom

BTS [Photo by Big Hit Music]

South Korea’s entertainment giants Hybe Co. and CJ ENM Co. reported solid top and bottom line for the third quarter with the former delivering all-time high quarterly results on the back of global excitement over K-pop and Korean original contents.

Hybe disclosed on Thursday that its operating profit for the July-September period came to 65.6 billion won ($55.33 million), up 134.1 percent from three months ago and 63.3 percent from a year ago. Revenue surged 22.4 percent against the previous quarter and 79.5 percent against a year prior to 341 billion won with a net profit of 49.5 billion won, jumping 144.2 percent on quarter and 81.8 percent on year.

Both operating profit and revenue were quarterly record highs.

Its strong performance was mainly led by a double-digit growth in album, merchandise and licensing sales, the company explained.

Album sales expanded 21 percent from the previous quarter to 129.7 billion won thanks to BTS’s chart-topping hit single “Butter” and “The Chaos Chapter: Fight or Escape” of five-piece boy band Tomorrow X Together.

Merchandise and licensing sectors totaled 76.7 billion won, gaining 53 percent from three months ago on the back of strong sales of merchandise utilizing Hybe artists’ intellectual property.

Revenue from advertising, television appearance and management also added 56 percent to 33.8 billion won.

Hybe’s online fan club community Weverse attracted 6.4 million monthly average users, up 20 percent on quarter largely owing to the addition of YG Entertainment’s girl group Blackpink.

Earlier in the day, Hybe announced it will develop an NFT trading platform in joint venture with Dunamu Inc., operator of South Korea’s top cryptocurrency exchange Upbit and continue to expand its IP portfolio to include global artists and sports stars.

“We expect further gains in our revenue in the coming months when offline concerts resume starting with BTS’s concerts in Los Angeles in November,” CEO Park Ji-won said.

Hybe shares are trading up 3.51 percent at 369,000 won in morning trading on Friday.

CJ ENM also reported strong earnings for the third quarter.

The Kosdaq-listed entertainment giant under CJ Group disclosed on Thursday that its consolidated operating profit came to 87.8 billion won, up 2.4 percent on quarter and 23.6 percent on year. The result beat the market consensus of 79.7 billion won operating income compiled by Yonhap Infomax.

“Hospital Playlist 2” and “Hometown Cha-Cha-Cha”

Sales reached 857.5 billion won, off 5.5 percent from the previous quarter but up 7.4 percent from a year prior. Net profit surged 40 percent on quarter and 128.5 percent on year to 74.4 billion won.

The company attributed its solid performance to gains in TV advertisement and digital sales.

In the media sector, TV advertisements and drama series sales jumped 19.5 percent on year to 442.8 billion won thanks to popular dramas “Hometown Cha-Cha-Cha” and “Hospital Playlist 2.” Operating income soared 119.4 percent to 64.2 billion won.

Digital sales from OTT service platform Tving also expanded 56.8 percent due to rich pipeline of original contents.

The commerce sector delivered 27 billion won in operating profit on sales of 315.8 billion won, decreased from a year ago due to off-season impacts in online sales.

The music segment posted an operating profit of 10.9 billion won, up 210.7 percent on year and sales of 65.8 billion won, up 40.4 percent on year driven by sales growth in Japan.

The movie business logged an operating loss of 14.3 billion on sales of 33.1 billion won, off 10.2 percent on year due to protracted social distancing restrictions.

CJ ENM shares are trading up 0.84 percent at 168,400 won on Friday.

[ㄏ Maeil Business Newspaper & mk.co.kr, All rights reserved]