BGF Retail, the operator of CU, announced Thursday that its Mongolian partner, Premium Nexus, reported sales of 286.1 billion Tugrik ($84.7 million) and an operating profit of 9.6 billion Tugrik ($2.8 million) for the first half of this year.
CU is the first to turn a profit in an overseas market since the domestic convenience store industry began expanding abroad in 2018, according to BGF Retail.
In 2018, CU signed a master franchise agreement with Premium Nexus, becoming the first Korean convenience store chain to enter the Mongolian market. It secured franchise rights in the region after paying a significant initial fee.
The number of CU stores in Mongolia has steadily increased from 21 stores in 2018 to 56 in 2019, 103 in 2020, 163 in 2021, 285 in 2022 and 380 in 2023, reaching 400 stores this month. It has established stores in 11 regions, including Ulaanbaatar and the second-largest city, Darkhan.
Despite the challenges of the COVID-19 pandemic and global economic downturn, CU Mongolia's annual sales have increased by an average of 12 percent.
Premium Nexus listed on the Mongolian Stock Exchange in 2021, recording the highest number of IPO subscribers (around 10,000) and the largest public offering amount (40.1 billion Tugrik) in Mongolian IPO history.
CU has transferred operational know-how and provided consulting for infrastructure development to its Mongolian partner. Based on this support, Premium Nexus adopted an automated process that uses advanced technology to accurately and efficiently select and prepare items for order fulfillment in a logistics center.
Along with a variety of Korean food, including ramyeon (instant noodles) and Korean-style craft beer, CU stores in Mongolia sell traditional Mongolian fried bread Boortsog and Khuushuur, a Mongolian dumpling usually made with beef.
As of November 2023, BGF Retail had over 500 stores abroad. As of July, it had 145 stores in Malaysia and seven stores in Kazakhstan.
reporter
Kim Joo-heon
jhkim123@ajunews.com
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