Orion Corp (KS:271560) experienced a downturn in its China sales this January, primarily due to the timing of the Lunar New Year. While the company saw weaker sales, regions like Vietnam and Russia registered impressive growth. The company’s stock closed 1.75% lower in Korea on Tuesday.

Key Regional Performance Highlights

China: Lunar New Year Creates Sales Challenge

• Sales dropped 11% YoY in KRW and 18% in RMB due to holiday timing.
• Sales figures for November 2024 to February 2025 are projected to exhibit mid-single-digit growth.
• Operating margins saw a decline of 140 bps, influenced by slowing production and rising costs.

Korea: Steady Growth Amid Price Increases

• Revenue increased by 1% YoY, with underlying sales climbing 2% YoY.
• Price hikes impacted sales growth by around 3%, reflecting slow traditional demand.

Vietnam: Strong Performance Continues

• Sales soared 13% YoY in KRW (7% in VND), even with disruptions from the Tet holiday.
• Underlying growth surpassed 10%, indicating robust demand.

Russia: A Ray of Hope with Soaring Sales

• Revenue surged by 36% in KRW (41% in RUB), fueled by strong consumer demand.
• A remarkable utilization rate of 120% may prompt capacity expansions in Q3 2025.

Cost Concerns and Market Outlook

Increased Input Costs Challenge Margins

• China: An increase of +4 percentage points in production costs.
• Vietnam: Rising +1 percentage point.
• Russia: Elevated by +5 percentage points.

Despite temporary pressures in China, Orion’s operations in Vietnam and Russia remain robust. The company anticipates steady growth into 2025.