Orion Vina enjoys huge profits from ChocoPie sales

By Tran Anh - Dec 20, 2018 | 03:58 PM GMT+7

TheLEADERIn 2018, Orion Vina has still retained the growth since previous years. The company reported the nine-month revenue of 151.9 billion won, equivalent to $150 million.

In 2017, Orion Vina achieved revenue of VND4,453 billion ($191 million), up 12 per cent year on year (yoy). Besides, the company's profit margin has improved significantly over years. In 2015, the company only obtained a profit of VND190 billion ($8.17 million), equivalent to profit margin of 5.8 per cent meanwhile in 2017, its profit reached VND712 billion ($30.6 million), equivalent to profit margin of 16 per cent.

Orion Vina's business results in Vietnam are expected to continue to improve in the coming years. According to BMI Research, Vietnam’s confectionery industry in 2018 is valued at about VND40 trillion ($1.72 billion). The increase in both income per capita in Vietnam and spending demand will create an excellent domestic market for the next 30 years.

Orion Vina enjoys huge profits from ChocoPie sales
Orion Vina's revenue and profit margin

Orion is one of the three largest food companies in Korea with revenue of 2016 trillion won in 2017, or about $1.72 billion. Despite its long establishment, Orion's business is focused on confectionery.

The company has nine main categories under three main brands: MarketO (biscuits, high-grade handmade chocolate), Dr.You (nutritional food) and Orion (sponge cake, snack, biscuits, candy, chewing gum, chocolate).

Vietnam is one of the four biggest markets of Orion, along with South Korea, China and Russia.

In Vietnam, Orion Vina Food Company Limited (Orion Vina) accounts for the largest market share of sponge cake and snack. Like its holding company, Orion Vina focuses on some main items such as Chocopie, Custas, O'Mara snack, Tayo or Goute.

Orion Vina has a leading position in each field. Particularly Orion Vina’s Chocopie cake is dominating the market with 58 per cent of market share, leaving other competitors such as Bibica or Kinh Do far behind. Orion Vina accounts for the second largest snack market share, following Oishi.

The success of Orion is recognized by a great marketing strategy. This confectioner has won the hearts of Vietnamese consumers thanks to the "Love" campaign, which is about sympathy and friendliness among Vietnamese people. It is the strategy that has brought success to Orion in Korea, helping Choco-Pie become a prestigious brand name in Korea.

Marketing has partly contributed to Orion’s increasing sales. The company said that during the period 2009 - 2013, Orion Vina achieved an average CARG (compound annual growth rate) of over 20 per cent.

The company has two factories located in My Phuoc, Ho Chi Minh City and Yen Phong, Bac Ninh. In addition to the domestic market, these plants also export products to the world.

The completion and stable operation of these factories have helped the company significantly reduce the prime and minimize the financial leverage. In 2017, the company no longer recognized short-term loans and recorded the accumulated profit of VND1,955 billion ($84 million).