[Edaily Reporter PARK JI-AE ] CJ LOGISTICS(000120)reported consolidated revenue of 3.38 trillion won and operating profit of 101.6 billion won for the second quarter of this year. Revenue increased by 10.9% year-over-year, but operating profit decreased by 11.9%.

While the company continued to grow in scale, driven by an increase in parcel volume, new contracts in Contract Logistics (CL), and growth in its global business, profitability was impacted by increased investment in service enhancement and cost pressures resulting from rising oil prices and inflation.

According to CJ LOGISTICS on the 11th, revenue for the O-NE (parcel delivery) division—its core business segment—totaled 984.8 billion won in the second quarter of this year, an 8.5% increase compared to the same period last year. Total parcel volume rose by 12.1%, driven by the expansion of services—such as the seven-day-a-week delivery service “Maeil O-NE” and the peer-to-peer parcel service “Bonae O-NE”—as well as the flexible operation of hub terminals. In particular, the volume of early-morning and same-day deliveries increased by 65% compared to the same period last year.

However, operating profit in the parcel delivery segment fell 10.7% year-over-year to 40.9 billion won. Proactive investments made to strengthen the competitiveness of delivery services weighed on profitability. CJ LOGISTICS explained, “The effects of these investments are gradually becoming evident, such as a 2.2% year-over-year reduction in unit operating costs for the first half of this year, driven by economies of scale resulting from the increase in volume.”

The Contract Logistics (CL) division recorded revenue of 900.1 billion won, an 8% increase compared to the same period last year, driven by new orders and expanded volumes from strategic clients. Revenue from the Storage, Warehousing, and Delivery (W&D) business rose 12% as volumes from major clients increased; within this segment, the retail and pharmaceutical sectors grew by 17% and 19%, respectively. Revenue from the Port Handling and Land Transportation (P&D) business also increased by 7% as revenue from existing orders was recognized.

Despite this revenue growth, operating profit for the CL division decreased by 11.4% to 39.8 billion won. This was due to increased costs for raw materials and supplies resulting from rising oil prices and inflation caused by uncertainties in the Middle East, as well as infrastructure investment costs for productivity innovations at fulfillment centers.

The Global Division recorded revenue of 1.206 trillion won, a 9.4% increase year-over-year, but operating profit decreased by 1.4% to 20.4 billion won. Although demand for project forwarding declined due to rising oil prices stemming from the U.S.-Iran conflict and concerns over a global economic slowdown, revenue growth was supported by contract logistics operations in strategic markets such as the U.S., India, and Vietnam, as well as the expansion of cross-border e-commerce (CBE) volumes.

CJ LOGISTICS plans to offset the investment burden in the second half of the year by improving operational efficiency in its parcel delivery and contract logistics businesses.
A CJ LOGISTICS official stated, “In the O-NE division, we will pursue diversification of our delivery portfolio and the optimization of hub operations, while in the CL division, we will focus on improving productivity at fulfillment centers and expanding integrated transportation volumes linked to the ‘The Unban’ middle-mile logistics platform,” adding "In our global business, we plan to strengthen our global end-to-end (E2E) logistics system—covering everything from production sites to international transport, local storage and transportation, and final delivery—by integrating forwarding services with contract logistics in strategic countries," the spokesperson added.