Amorepacific Group's net plunges nearly 50 percent in 2022

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Amorepacific Group's net plunges nearly 50 percent in 2022

An employee enters Amorepacific Group’s headquarters in Yongsan District, central Seoul. [ YONHAP ]

An employee enters Amorepacific Group’s headquarters in Yongsan District, central Seoul. [ YONHAP ]

 
Amorepacific Group's net profit plunged nearly 50 percent in 2022 as consumption in China slowed and duty-free businesses still on the struggle to recover.
 
Its net profit came in at 149.2 billion won last year, down 48.9 percent on year, falling far short of the market consensus of 182.7 billion won compiled by FnGuide. 
 
Revenues slipped 15.6 percent to 45 trillion won, in line with market expectations of 44.6 trillion won. Operating profit declined 23.7 percent to 271.9 billion won, though higher than 248-billion-won market consensus.
 
The company reported10.7 billion won in net profit in the fourth quarter from 73.1 billion won of net loss in the same quarter the previous year. Revenues fell 16.7 percent to 1.2 trillion won, while operating profit skyrocketed 3,331.5 percent to 78.6 billion won. 
 

Cosmetics subsidiary Amorepacific, 38.04 percent owned by Amorepacific Group, logged a net profit of 129.3 billion won for 2022, a fall of 28.5 percent on-year and exceeding market expectations of 121.6 billion won. 
  
Operating profit fell 37.6 percent to 214.2 billion won, though higher than 201.9-billion-won market consensus.
 
Revenues dropped 15 percent to 41.3 trillion won, slightly dipping below the market expectation of 41.48 trillion won.
 
The fall is partly due to the fall in sales at duty-free shops, where 22 percent of  company's sales are made. 
 
"Online sales increased as e-commerce sales in cosmetics grew by more than 20 percent," the company said in a statement. 
 
In the fourth quarter, the cosmetics company's net was 24.6 billion won, a turnaround from 54.4 billion won net loss same period the previous year. It beat market expectations of 20.6 billion won.
 
Operating profit jumped 122.9 percent to 57 billion won, well above the market consensus of 43.6 billion won.
 
Revenues decreased 17.9 percent to 1.09 trillion won, hitting market consensus of 1.1 trillion won.
 
Local sales fell 20.7 percent on-year to 633.7 billion won, and overseas sales fell 16 percent to 441.6 billion won.  
 
In Asia, sales plummeted 24 percent, largely the result of China sealing off its borders amid the Covid-19 pandemic.
 
In North America and Europe, the sales rose 99 percent as cosmetic brands flourished. Existing brands such as Laneige focused on online and offline events hosted during American holidays, and part of the growth lies in sales made from the American skincare brand Tata Harper, which the company acquired for 168.1 billion won last September.  
 

BY LEE JAE-LIM [lee.jaelim@joongang.co.kr]
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