South Korea: HiteJinro’s Q1 beer sales slide 3.3% yoy

Korean beer maker HiteJinro posted consolidated 1Q21 sales of W535.1 bln (+0.2% y-y) and an operating profit of W52.9 bln (-5.7% y-y), the Business Korea reported on May 17.

The domestic beer and soju divisions were hit by social distancing measures, but the expansion of imported beer and overseas sales defended the decline in earnings, leading to consensus-beating results, the company said.

Sales at the beer division slid 3.3% y-y. The overall domestic beer market shrank 8% y-y, with the imported beer market retreating 13% y-y and the firm’s domestic beer sales falling 11% y-y. The larger decline compared to the overall market is attributable to an upsurge in speculative demand for products at a competitor prior to its price hikes. Also, HiteJinro’s imported beer sales grew 34% y-y thanks to strong sales of Paulaner and Somersby, which helped to defend profitability.

Sales at the soju division upped 1.3% y-y. The overall domestic market slid 4.4% y-y, while the company’s domestic soju sales fell 4.0% y-y. Its overseas growth offset the domestic decline. In particular, overseas sales of fruit soju jumped 3~4x y-y, driving earnings growth. As a result, the portion of overseas sales rose from 8% to 10.8%.

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