Seoul: CJ Logistics Corp., a leading logistics firm in South Korea, announced a decrease in its second-quarter net profit, attributing the decline to reduced demand and rising costs. The company's net profit for the April to June period was reported at 58.2 billion won (US$42 million), marking a 5.1 percent drop from the 61.3 billion won recorded in the same quarter the previous year.
According to Yonhap News Agency, despite the downturn, CJ Logistics' earnings surpassed market expectations. Analysts had predicted a net profit of 49.7 billion won, based on a survey conducted by Yonhap Infomax, the financial data firm of Yonhap News Agency.
The logistics firm's operating profit also saw a decline, dropping 8.1 percent year-on-year to 115.2 billion won. Revenue experienced a slight decrease of 0.4 percent, totaling 3.04 trillion won for the quarter.
CJ Logistics attributed its weakened financial performance to a combination of factors, including decreased consumer spending and significant initial costs associated with the launch of its new Everyday O-NE delivery service earlier this year. This service, which commenced on January 5, offers deliveries seven days a week, including public holidays, and is aimed at competing with Coupang Logistics Services, the logistics division of the e-commerce powerhouse Coupang Inc.