1. Hanil Feed H1 2025 Performance: What Happened?

Hanil Feed reported KRW 107.8 billion in revenue for H1 2025, showing growth compared to the same period last year. However, operating profit decreased to KRW 1 billion, while net profit, though improved at KRW 1.7 billion, was significantly influenced by non-operating income.

2. Analyzing the Profitability Decline: Why These Results?

Despite revenue growth, the decline in profitability is primarily attributed to falling prices in the feed segment and weak demand in the meat distribution segment. The feed segment struggled to pass on increased raw material costs, while the meat distribution segment faced intensified market competition.

3. Key Insights for Investors: What to Do?

  • Investment Points:
    • Stable revenue from the feed segment
    • Growth potential in the meat distribution segment
    • Improved consolidated financial health
  • Risk Factors:
    • Declining profitability
    • Cost pressures (exchange rate, raw material prices)
    • Market uncertainty
    • Dependence on Seoul Milk Cooperative
    • High debt-to-equity ratio (standalone basis)

4. Future Outlook and Investment Strategy: What Actions Should Investors Take?

The current investment recommendation is ‘Neutral’. Investors should closely monitor the company’s ability to improve profitability through price increases in the feed segment, new sales channels in the meat distribution segment, and cost reduction efforts. Furthermore, exchange rate and raw material price volatility, as well as contract renewal with Seoul Milk Cooperative, are crucial factors to consider. A thorough analysis of the company’s future strategies and market conditions is essential before making investment decisions.