- Demonstrated a turnaround in profit due to the expansion of digital content business and growth in commerce despite the tough market conditions
- Offset the slump in the TV commercial market by recording highest-ever digital sales in the media division
- Recorded double-digit growth with the operating profit of KRW 49.8 billion in the commerce division
- Increased profitability based on content and product competitiveness in the second half-year with the drama “Stranger 2”, film “Deliver Us From Evil”, O Shopping Living PB “@sential”, etc.
Entertainment and lifestyle company CJ ENM announced on the 6th that it has recorded KRW 837.5 billion in sales and KRW 73.4 billion in operating profit in Q2 2020 based on the Korean International Financial Reporting Standards (K-IFRS) consolidation.
To begin with, the media division recorded KRW 406.3 billion in sales and KRW 24.9 billion in operating profit thanks to the ratings and buzz around major content, such as the drama “Hospital Playlist” and entertainment show “Three Meals a Day: Fishing Village 5”. In particular, it recorded the highest-ever digital sales (YoY 16.6%) with high growth in digital ad sales due to the increase in paying subscribers for TVING (YoY 66.2%) and digital platform traffic. Sales of content, such as “Hospital Playlist” (YoY 10.9%), also contributed to better performance. In Q3, the company plans to maximize profitability by streamlining the production costs and promote business growth based on digital sales and content sales.
The commerce division showed double-digit growth with the operating profit of KRW 49.8 billion. The drastic reduction of low-profit online products, the increase of exclusive brand sales, such as @sential, Secret, and Daniel Cremieux, and the increase in demand for health foods and household items due to COVID-19 further led to increased profits. Sales increased by 5.2% year-on-year to KRW 376.2 billion, while the volume handled dropped by 4.5% to KRW 972.3 billion. The company plans to reinforce its competency in online specialty malls of key product lines, such as fashion, hair/beauty and foods, in the second half-year as well and strengthen its profit-oriented management stance by expanding the scope of exclusive brands focusing on foods and fashion categories.
The music division recorded KRW 42.5 billion in sales and KRW 2.1 billion in operating profit. In particular, sales of albums and music releases through “IZ*ONE” and “Heize” maintained steady growth, recording KRW 33 billion (YOY 17.6%). In the second half of the year, the company plans to expand its concert business based on the digital platform and focus on increasing profitability by expanding global intellectual property rights including Japan’s “JO1” and the debut group to be created through “I-LAND” Part. 2.
The film division recorded KRW 12.5 billion in sales and KRW 3.5 billion in operating loss. Sales declined as domestic and overseas theater releases were suspended due to the influence of COVID-19. However, the company plans to recover its profitability and reinforce its global competitiveness with a focus on the lineup for the second half of the year, such as “Deliver Us From Evil” released this month, as well as “Pawn”, “Collector” and “Hero”, alongside some of the company’s own special projects to be released overseas in Vietnam, Thailand, and Turkey.
“We have succeeded in a turnaround of our profits with the expansion of our digital content business and growth in commerce despite the tough market conditions,” said an official at CJ ENM. “We will further increase content and product competitiveness in the second half of the year with the drama “Stranger 2”, film “Deliver Us From Evil”, music entertainment show “I-LAND” Part. 2 and O Shopping Living PB “@sential”, etc. and focus on reinforcing our growth engines around digital and global businesses.”