[Edaily Reporter Hyera Lee ] On the 22nd, Hana Securities projected that LOTTE WELLFOOD(280360)’s second-quarter earnings would meet market expectations, citing robust growth in its overseas operations despite rising raw material prices and one-time costs.

Shim Eun-ju, an analyst at Hana Securities, stated in a report released that day, “The company is expected to post earnings in line with market expectations, driven by robust overseas top-line growth and internal cost control.”
Hana Securities estimated LOTTE WELLFOOD’s second-quarter consolidated revenue at 1.1285 trillion won and operating profit at 45 billion won. This represents year-over-year increases of 6.0% and 31.1%, respectively.
Domestic sales of confectionery, ice cream, and bakery products are expected to increase by 4.0% year-over-year. Analyst Shim predicted, “Sales of dried fruits and ice cream will benefit from the launch of new products such as ‘Kancho Name Search Part 2’ and ‘KBO Pepero,’” adding, “In the food division, despite the positive impact of rising soybean oil prices in the oil segment, sales of dairy products and home meal replacements (HMR) are expected to continue declining, resulting in revenue at last year’s level.”
Overseas confectionery sales are expected to continue their strong growth of around 17% compared to the same period last year. He noted, “Ice cream sales will increase significantly due to the recovery in Kazakhstan and favorable weather conditions in India,” adding, “The Indian dried fruit segment will also continue its double-digit growth trend following the first quarter.”
Annual performance is also expected to align with LOTTE WELLFOOD’s previously announced outlook. Analyst Shim explained, “Considering the profit trend in the first half, it appears possible to achieve the lower end of the estimated annual consolidated operating profit range.” However, he added, “While there are some profit pressures in the second half—such as rising unit prices for raw materials—the key will be how effectively these are offset by new product launches and strong overseas growth.”
Analyst Shim added, “The current stock price is trading at a 12-month forward price-to-earnings ratio (PER) of 8x, so valuation concerns are limited,” and noted, “We believe the recent decline in earnings visibility has already been reflected in the stock price.”