South Korea’s Amorepacific Group announced on February 1 its net profit plunged nearly 50 percent in 2022, on the back of slowing consumption in China and impeded travel retail sales.
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The owner of Amorepacific, Innisfree, Sulwhasoo, and Laneige brands, among others, said net profit came in at KRW 149.2 billion last year, down 48.9 percent year-on-year, missing estimates of KRW 182.7 billion compiled by FnGuide.
Likewise, yearly revenues slipped 15.6 percent to KRW 45 trillion, while operating profit declined 23.7 percent to KRW 271.9 billion.
For the fourth quarter, the company reported KRW 10.7 billion, from KRW 73.1 billion net loss in the same quarter the previous year. Revenues fell 16.7 percent to KRW 1.2 trillion, while operating profit surged 3,331.5 percent to KRW 78.6 billion.
Cosmetics subsidiary Amorepacific, 38.04 percent owned by Amorepacific Group, logged a net profit of KRW 129.3 billion for 2022, a dive of 28.5 percent, while operating profit fell 37.6 percent to KRW 214.2 billion.
Revenues dropped 15 percent to KRW 41.3 trillion, hit by a 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 Asia, sales plummeted 24 percent, largely the result of China closing off its borders amid the Covid-19 pandemic.
In North America and Europe, the sales rose 99 percent on the back of cosmetic brands sales.
Coinciding earnings update, Amorepacific announced it has signed an agreement with Asleep to strengthen its research on sleep aid supplements. The company said it aims to develop customised sleep aid supplements and cosmetic products based on hyper-personal sleep diagnosis technology.