Korea confectioner Orion records $24 mln H1 profit in Vietnam

Leading South Korean confectionery firm Orion recorded post-tax profits of KRW32.1 billion ($23.9 million) from operations in Vietnam in the first half of 2023, up 3.5% year-on-year.

According to Orion’s H1/2023 report, Orion made revenues of KRW201 billion ($149.6 million) from Vietnam's operations in the period, up 2.7% year-on-year.

As a result, Vietnam accounted for 14% of the firm’s total revenue, the third-biggest after China (40%) and South Korea (37%). Other key markets were Russia with 7% and India with 1%.

Globally, Orion’s revenue in the period reached KRW1,378 billion ($1.03 billion).

In Vietnam, the performance was impacted by slow domestic consumption, especially in the northern region; continuous inflation affecting potato, rice and gelatin prices; and increase in salary and employee welfare expenses, Orion said.

Pie was Orion’s biggest cash earner in Vietnam with a revenue of KRW76.4 billion ($56.88 million), down 7.2% year-on-year; followed by snacks with KRW74.8 billion ($55.68 million), up 7.8%; biscuits with KRW19.8 billion ($14.74 million), up 12.5%; gum and candy with KRW8.3 billion ($6.18 million), up 62.1%; and gift sets with KRW4.4 billion ($3.28 million), down 36.5%.

Besides, the firm earned revenues of KRW16.9 billion ($12.58 million) from exporting goods to the UAE, Mongolia, Kuwait and other countries, up 20%.

Regarding its operating profit, Vietnam’s figure was KRW30.1 billion ($22.41 million), accounting for 14% of Orion’s global figure in January-June, also the third-highest.

Notably, Vietnam’s operating profit figure went down 9.6% year-on-year, the only market with reduction in the period, the Orion report said.

Previewing its H2/2023 prospects, Orion said it expected growth in Vietnam thanks to capacity expansion and the launch of new products. In particular, the confectioner will expand its warehouse sector and production lines of snacks, biscuits and cakes. Besides, the firm will introduce new categories of mooncakes and dairy products; and new varieties of existing products, like Jam Chocopie and Masita snacks with rice and shrimp flavors.

Orion entered Vietnam in 1995, via its wholly-owned subsidiary Orion Food Vina (OFV) and with one of its most famous products - Chocopie.