CJ ENM CO (035760) Q3 2024 earnings summary

Executive summary

• Achieved a year-over-year turnaround in profitability despite a sluggish advertising market and slow recovery in media and content production sectors.

• Operates four main business segments: media platform, film/drama, music, and commerce, with a diversified global presence and strong content production capabilities.

• Strengthened global content sales, with notable hits in both drama and non-scripted entertainment, and increased synergy between channels and OTT platforms.

• Growth driven by strong TVING performance, mobile live commerce, and global music expansion, offset by underperformance in Film & Drama.

• Ongoing investments in OTT (TVING), virtual production, and global content studios to drive future growth.

Financial highlights

• Q3 2024 consolidated revenue was ₩1.1246 trillion, up 1.2% year-over-year; 2024 YTD consolidated revenue: ₩3,443.4 billion, up from ₩3,108.7 billion YoY.

• Operating profit for Q3 2024 rose 113.8% YoY to ₩15.8 billion; 2024 YTD operating profit: ₩63.5 billion, a turnaround from a ₩73.3 billion loss YoY.

• Net loss of ₩531.4 billion in Q3 2024 due to one-off LiveCity-related charges; 2024 YTD net loss attributable to controlling interests: ₩477.0 billion.

• Entertainment revenue: ₩790.7 billion, operating profit: ₩6.7 billion; Commerce revenue: ₩333.8 billion, operating profit: ₩9.2 billion in Q3 2024.

• Cash and equivalents at period end: ₩782.7 billion.

Outlook and guidance

• Media platform to enhance channel viewership and TVing traffic with competitive content in Q4; TVING to launch new original series and sports content.

• Pictures and drama to focus on profitability through expanded production and distribution, with high-profile releases and improved delivery.

• Music to build on album activities, debut new girl group, expand global tours, and leverage live concerts.

• Commerce to maximize sales via mobile live commerce and brand promotions, leveraging high season.

• TVing aims to reach break-even by year-end, with further growth expected from sports content and new business models in 2025.