Amorepacific bounces back from Covid in a big way
Amorepacific Group’s second quarter net rose more than 2,000 percent on year to 142.8 billion won ($127.5 million), far surpassing market estimates.
The second quarter profit represented a huge recovery from a Covid-19 crash last year that shriveled profit more than 90 percent compared to the same period in 2019.
Amorepacific Group, the company behind cosmetics brands Sulwhasoo, Etude and Innisfree, reported 142.8 billion won in second quarter net profit, up 2,680.2 percent on year. Its operating profit was up 188.5 percent to 104.6 billion won on sales that increased 10.4 percent to 1.3 trillion won.
Amorepacific's net saw an extraordinary gain in the second quarter from sales of overseas real estate properties, where it operated stores. The company did not disclose specific locations of the properties it sold.
The group said earnings were led by sales of cosmetics products through online channels, especially luxury products.
Sales through online channels grew 40 percent in Korea.
Outside of Korea, sales of luxury cosmetics brands online grew almost 100 percent in China, while sales of Innisfree products in North America were helped by Amazon.
Sales of Innisfree and Laneige products at Sephora helped raise earnings in Europe, according to the company.
Ha Nu-ri, an analyst at Meritz Securities, in a report published on July 9 estimated a net profit of 40.1 billion won, up 1,390.6 percent on year, an operating profit up 206.7 percent and sales up 10.5 percent.
Ha recommended investors to approach Amorepacific Group "conservatively" in the report because the company “lacks issues related to its business in Korea as well as factors that could pull the momentum” for its stock growth.
Amorepacific Group shares were up 0.67 percent Wednesday to close at 60,000 won.
BY JIN MIN-JI [email@example.com]