Emart reports 806 billion won net profit in the first quarter

An Emart branch in Seongsu-dong, eastern Seoul. [EMART]

Emart reported a higher-than-expected net profit of 805.8 billion won ($623.9 million) in the first quarter, up 689 percent on year.

The figure is more than double the market consensus of 302.4 billion won compiled by FnGuide.

Revenue was a record-high 7 trillion won, up 18.8 percent on year and in line with analyst expectations.

Operating profit was down 72 percent on year to 34.4 billion won, missing the 131.6-billion-won market consensus. The company blamed its two big acquisition deals last year.

Emart acquired an additional 17.5 percent of Starbucks Korea for 474.3 billion won from Starbucks Coffee International in July 2021. It became the largest shareholder, with a 67.5 percent stake, and renamed the company as SCK. Emart was also chosen to acquire an 80 percent stake in eBay Korea for 3.44 trillion won last June, later renaming the company Gmarket Global.

Emart runs Emart stores, SSG.com, Emart24 and Starbucks branches in Korea.

SSG.com posted revenue of 425 billion won, up 26.1 percent on year, as purchases increased. Goods worth 1.56 trillion won were purchased in the first quarter, up 23 percent on year.

Operating loss was 25.7 billion won, compared to a loss of 22.6 billion won the previous year. Emart said investments and promotions to increase market share of SSG.com was one of the reasons for the drop.

Emart24 logged revenue of 484.2 billion won, up 14.5 percent on year. The operating loss decreased 92 percent to 400 million won, compared to a loss of 5.3 billion won the previous year. The company said it has been increasing the number of Emart24 branches to reach more customers, breaking 6,000 branches this quarter.

Gmarket Global, as a subsidiary starting last December, reported revenue of 316.3 billion won and an operating loss of 19.4 billion won. SCK, incorporated last October, posted revenue of 602.1 billion won an operating profit of 29 billion won.

BY LEE TAE-HEE [lee.taehee2@joongang.co.kr]