Cheil Worldwide posts higher net income as North American sales offset revenue dip

Cheil Worldwide said Friday its second-quarter net income rose 24 percent from a year earlier to 63.5 billion won ($44.4 million), as efficiency gains in captive marketing and growth in North American and emerging markets lifted overall gross profit.

Consolidated revenue for the April-June period slipped 4 percent on year to 1.07 trillion won ($751 million), yet operating profit managed a 0.6 percent increase to 92.7 billion won ($64.8 million). Gross profit climbed 1.2 percent to 489.6 billion won ($342 million). Income before tax surged 27.2 percent to 95 billion won ($66.4 million).

"Despite adverse external conditions, we defended operating profit at last year's level," the company said regarding the quarterly results.

For the first half of the year, operating profit faced pressure from one-time costs associated with restructuring overseas operations and a temporary reflection of headquarters' retirement allowances. The share of gross profit derived from non-affiliate business rose to 29 percent in the first half, up one percentage point from the previous year, with domestic contributions at 19 percent and overseas at 32 percent.

By service line, digital solutions remained the dominant revenue driver, contributing 56 percent of gross profit in the first half. Retail and below-the-line activities made up 30 percent, while above-the-line traditional advertising comprised the remaining 14 percent.

Looking ahead, Cheil Worldwide plans to accelerate business innovation through artificial intelligence to enhance operational efficiency and pursue new growth engines, including the expansion of its enterprise solution portfolio.