Amorepacific profit drops 20 percent in tough market

Amid the rising competition among cosmetic brands, Amorepacific Group’s operating profit retreated more than 20 percent in the first quarter compared to the same period a year earlier, the group announced Monday.

The operating profit for the cosmetics giant slid 26 percent on year to 204.8 billion won ($176 million). Its sales in the first quarter inched down 1 percent on year to 1.64 trillion won.

Amorepacific has numerous cosmetics brands under its arm, which includes Innisfree, Etude House and Espoir.

“In the first quarter, Amorepacific Group continued investment to raise our competitiveness and create grounds for our businesses to leap,” the company said in a statement. Amorepacific, however, accomplished meaningful achievements in the domestic and overseas duty-free businesses revolving around its luxury brands, the company explained.

The group’s luxury brands include Sulwhasoo and Hera.

“Amorepacific Group plans to prepare a ground to promote its growth on through the discovery of new retail channels and foreign markets as well as [the practice of] digital innovation throughout the rest of the year.”

Among the group’s cosmetics brands, Etude House particularly showed gloomy performance, with its operating profit showing 5.8 billion won loss.

Innisfree also struggled, with its operating profit nose-diving 36 percent to report 21.1 billion won.

Performance of Aestura and Espoir improved. Aestura showed a whopping 149 percent increase in its operating profit with 2.8 billion won while Espoir returned to profit after two years with 50 million won.

BY JIN MIN-JI [jin.minji@joongang.co.kr]