Dividends, share buybacks planned for 2027–2029
ROE target set at 10–20%
First-half operating profit up 33%, net profit up 62.9%
Profitability gains to underpin value-up push
Dongwon Fisheries has unveiled a corporate value enhancement plan to return 50 percent of net profit for the period to shareholders over the next three years. The company aims to lift its undervalued share price through expanded dividends and share buybacks while targeting a market capitalization of 100 billion won ($72.2 million) over the medium to long term.
Dongwon Fisheries disclosed its "2026 Corporate Value Enhancement Plan" through DART on Thursday in accordance with Korea Exchange guidelines. The plan covers strengthening profitability and core business competitiveness, expanding shareholder returns, improving capital efficiency and enhancing market communication.
The centerpiece is shareholder returns. Dongwon Fisheries plans to maintain a total shareholder return ratio — covering dividends and share cancellations — at 50 percent of net profit for the period from 2027 through 2029. In 2027 particularly, the company said it will actively pursue paying out 50 percent of net profit for the period as cash dividends.
The company also plans to disclose the basis for dividend decisions and their execution results to the market, improving the predictability of its shareholder return policy. It said it will meet distributable earnings requirements on the back of first-half earnings improvements and sustain stable shareholder returns going forward.
The earnings turnaround underpins the value-up plan. Dongwon Fisheries posted consolidated revenue of 89.8 billion won in the first half of this year, down 7.7 percent from a year earlier. Operating profit rose 33.0 percent to 8.1 billion won and net profit for the period climbed 62.9 percent to 7.5 billion won, reflecting improved profitability despite the revenue decline.
Dongwon Fisheries also set a target to raise its return on equity to between 10 and 20 percent and achieve a market capitalization of 100 billion won over the medium to long term. The company said it intends to lift its price-to-book ratio, currently around 0.5 times, to address the market's undervaluation of its shares.
To that end, the company plans to sell inefficient assets, optimize its fleet and expand the share of high-value-added processed food products. It has set capital allocation priorities in the following order: strengthening core business competitiveness, growth investment, financial stability, shareholder returns and selective mergers and acquisitions.
Dongwon Fisheries also pledged to strengthen market communication. The company will report regularly to its board on the progress of the value enhancement plan and disclose updates at least once a year. It plans to hold regular IR sessions tied to earnings announcements and bolster shareholder communication channels on its website.
Corporate value enhancement plans are designed to help companies earn fair market valuations by improving profitability and capital efficiency while expanding shareholder returns. For companies with low price-to-book ratios in particular, increasing dividends or canceling treasury shares can boost returns to shareholders and raise per-share value. Actual execution, however, matters more than the plan itself. For Dongwon Fisheries, consistently delivering on its stated shareholder return policy alongside earnings improvement will be the key to resolving its undervaluation.
kacew@heraldcorp.com
