CU and GS25 Post Strong Q1 Earnings Fueled by Desserts and Collaboration Products

South Korea's leading convenience store chains, CU and GS25, have posted robust financial results for the first quarter of the year, underscoring their resilience and adaptability in a high-inflation environment. Both BGF Retail, operating CU, and GS Retail, managing GS25, have demonstrated impressive growth, with CU's revenue climbing 5.2% to 2.12 trillion won and its operating profit soaring 68.6% to 38.1 billion won.

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Dessert lineups reflecting trends such as 'Ddujonku' and 'Butter Tteok,' and value-for-money PBICK convenience foods, among other strategic products tailored to high prices, supported sales growth.

CU's success is largely attributed to its strategic focus on trendy dessert items like 'Ddujonku' and 'Butter Tteok,' alongside its value-driven private brand (PB) convenience foods. These offerings have resonated well with consumers seeking affordable yet satisfying options amidst rising living costs. The company highlighted that these customized strategic products have been instrumental in supporting sales growth.

GS25, part of GS Retail, also experienced a significant upswing, with convenience store sales growing 3.7% to 2.08 trillion won. The chain's performance was propelled by its innovative approach to differentiated products, including successful collaborations with virtual idol group PLAVE and popular creator Jjyang. Furthermore, GS25 noted a remarkable 73% year-on-year increase in sales to foreign customers, reaching an all-time high. This surge in international patronage highlights the growing appeal of Korean convenience stores to tourists and expatriates alike.

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Differentiated products significantly boosted convenience store performance. Stores focusing on fresh food also saw significant growth.

Beyond their core convenience store operations, both companies saw positive performance in other business sectors. GS The Fresh supermarket chain reported growth in both revenue and operating profit, with its quick commerce service experiencing a substantial 32.8% surge. GS Shop, the home shopping channel, also maintained a steady performance with increased revenue and operating profit. This overall positive financial outlook across various business segments reflects the strong market position and strategic execution of these retail giants.

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Collaboration products such as the 'Heukbaek Curry 2' convenience food series, the virtual idol 'PLAVE' series, and creator 'Jjyang's 'Daesikga' series sold over 1 million units each, driving performance growth.