In the first quarter, overseas sales reached KRW 168.4 billion, an increase of 37.5%. The domestic market size was reduced, but sales performed well.
In the second quarter, profitability is expected to improve due to increased sales prices in the overseas market, improved cost competitiveness, and lower shipping costs
Increasing Daedong's market power to maximize profit through increased sales of finished products, parts, and services.
With record-high quarterly performance, Daedong continues to grow steadily both domestically and internationally.
Daedong (CEO Kim Joon-Shik Kim, Yoo-Hyun Won) announced on 16th that it had reached KRW 356.8 billion in consolidated sales, an increase of 20% year over year. Making its highest-ever quarterly sales since its foundation, the company had outpaced the 338 billion KRW sales of 2021 Q2, the busiest season of the year.
There were 231.6 billion KRW in overseas sales and 125.2 billion KRW in domestic sales. Overseas sales in the same period last year totalled KRW 168.4 billion, an increase of 37.5%. The percentage of overseas sales in Q1 2021 was 56%. The percentage of domestic sales was 44%. Overseas sales increased by 65% this year as exports increased. In the first quarter of this year, the domestic compact tractor market size decreased by 8.9% (based on Nonghyup financial loans), so the year-on-year sales performance is still impressive.
As a result of the fourfold increase in ocean freight compared to the first quarter of last year, increased raw material costs resulting from the global supply chain crisis, and a reorganization of management systems resulting from the implementation of the ERP system, the company recorded an operating profit of KRW 21.6 billion in the first quarter of this year. Daedong decided to protect its competitiveness and business relationships by not reflecting the rise in raw materials costs in the selling prices of products ordered by overseas dealers last year. Despite this, performance in the second quarter was positive. With the launch of the "Global Quality Innovation TFT" that began operation last year, Daedong increased its selling prices in over 70 export markets, including North America and Europe, and improved its cost competitiveness through innovation in quality and diversification of the supply chain. Moreover, the freight rate flattened out, forecasting an increase in profits.
In contrast to other companies, Daedong maximizes its profits not only from finished products but also from parts and services by increasing supply through its brand in the long-term and continuously improving market dominance. The retail compact tractors for sale and utility vehicles in North America sold by Kioti's Tractors Daedong's export brand have grown by an average of 28 percent over the past three years.e market share increased from slightly over 6% in the first quarter of last year to close to 8% in the second quarter. In order to expand its export market, Daedong developed a global-standard supply chain and quality control system for 50,000 compact tractors per year. In addition, Daedong is developing strategies to venture into agricultural equipment and mobility with its newly established Global Business Development (GBD) Division. By providing differentiated customer and product services, Daedong will increase its market dominance in the domestic market. To expedite the platform business for future agriculture, Daedong Connect, a remote-control service for agricultural machinery, will be introduced in the second quarter with enhanced features that can cover light and medium tractors.