Shinsegae's bottom line gutted but better than last quarter

Shinsegae Group Logo. [SHINSEGAE GROUP]

Shinsegae Department Store’s net profit dropped 98.3 percent on year in the third quarter, as nationwide social distancing affected sales.

Operating profit dropped 73.8 percent on year to 25.1 billion won ($22.5 million). Revenue dropped 24.2 percent on year to 1.24 trillion won. Its net profit was 900 million won, a turn from a 106.3-billion-won loss the previous quarter.

Luxury goods and home appliances helped drive sales, as well as its large-sized stores in the greater Seoul area.

Among its companies, Shinsegae International recorded a net profit of 5 billion won. Shinsegae Department Store in Centum City, Busan posted a 7.4-billion-won net profit.

Sales at Shinsegae Duty Free was still struggling from the pandemic, but it did benefit from rent discounts at Incheon International Airport and revenue generated by duty-free inventory sold to local customers. Sales revenue for Shinsegae’s duty-free business was 437.2 billion won, while an operating profit loss of 20.5 billion won was reported.

Net profit at furniture brand Casamia jumped 15 percent and operating profit 32 percent from the corresponding period last year, as customers socially distancing at home started purchasing more home-related goods.

“Led by an improving sales performance at Shinsegae’s department stores, we expect a better fourth quarter, following the Incheon International Airport’s revised rent plan, sales increases of international fashion brands and cosmetics from Shinsegae International and continual growth from Casamia,” said an official from Shinsegae Group.

BY KANG JAE-EUN [kang.jaeeun@joongang.co.kr]