SEOUL, June 10 (Yonhap) -- The majority of South Korean food firms saw their earnings tumble in the first quarter of this year due to business hour regulations on large retailers by the government and weak consumer demand amid the economic slump, industry data showed Monday.
Combined operating profit of the country's top 19 food firms came to 470.3 billion won (US$419.7 million) in the January-March period, down 14.55 percent from 550.2 billion won a year earlier, according to the data by the Financial Supervisory Service (FSS).
CJ Cheiljedang Corp., the top industry player, posted 158.4 billion won in operating profit in the first quarter, down 20.95 percent on-year. Operating profit of Orion Confectionary Co. fell 19.73 percent, with that of Lotte Chilsung Beverage Co., the largest beverage company, retreating 28.74 percent over the cited period.
Pulmuone Foods Co. suffered the biggest drop of 67.93 percent in operating profit in the first three months of this year. Operating profit of Crown Confectionary Co. edged down 1.8 percent, while that of Daehan Flour Mill Co. and Binggrae Co. shed 34.64 percent and 50 percent, respectively, over the cited period.
Industry watchers attributed the weak performances to the government's business hour restrictions on large discount chains, imposed since early this year to protect struggling small retailers. As a result, major supermarket chains like E-Mart and Lotte Mart have been forced to close their stores twice a month, which has dampened their overall sales, including that of food products.
"Due to the economic downturn and government regulation on large discount stores, the food industry showed a disappointing performance," said Park Ju-geun, the head of CEO Score, a Seoul-based corporate researcher. "Such a trend is likely to continue down the road."
Despite this, some food companies fared better in the first quarter. Daesang Corp., Dongwon F