CJ Logistics' Q1 net profit beats market consensus

CJ Logistics’ net profit rose 53.6 percent on year to 48.4 billion won ($36.52 million) in the first quarter thanks to increased profits from price increases in unit delivery cost and a revamp in cost structure.

CJ Logistics' headquarters in Jongno District, central Seoul [CJ LOGISTICS]

CJ Logistics’ net profit rose 53.6 percent on year to 48.4 billion won ($36.52 million) in the first quarter thanks to increased profits from price increases in unit delivery cost and a revamp in cost structure.

The figure beat the market consensus of 40.33 billion won compiled by market tracker CompanyWise.

Operating profit went up 30.9 percent on year at 99 billion won, the company reported Thursday, beating the 93.9-billion-won expectations. Sales decreased 1.7 percent on year to 2.81 trillion won, dipping below the market consensus of 2.91 trillion won.

"The significant increase in operating and net profits resulted from an improvement in profitability through price increases and innovation in cost structure," CJ Logistics said in a press release on Thursday.

Its parcel and e-commerce division, in particular, drove performance with a 7.6 percent increase in revenue and a 75.8 percent increase in operating profit.

The launch of CJ Logistics' new integrated delivery service brand "O-NE" and the enhancement of customized delivery services led to a volume increase, and the price hike effect contributed to the growth of performance.

Its CL, or corporate logistics, sector revenue and operating profit increased by 5 percent and 17.9 percent, respectively, due to higher volumes from clients of automobile companies and new customer acquisitions, as well as increased operational efficiency.

The global sector of CJ Logistics, however, saw a decline in both revenue and operating profit. This was due to weak performance in freight forwarding despite attempts to improve revenue structure and expand the supply chain in strategic countries such as the United States and India, the company explained.

CJ Logistics closed 2.05 percent higher Thursday at 79,500 won.

BY SEO JI-EUN [seo.jieun1@joongang.co.kr]