![[종합] Amorepacific, No. 1 in the beauty industry, allows LG Life Insurance to reverse](http://img.lb.inews24.com/facebookexternalhit/face/626x352/image_joy/202102/161234085495_1_172800.jpg "[종합] Amorepacific, No. 1 in the beauty industry, allows LG Life Insurance to reverse")
[아이뉴스24 이현석 기자] AMOREPACIFIC, which has kept the beauty industry’No. 1 in immovable’, has collapsed. LG H&H, which has shown a rapid recovery in the Chinese market and has drawn a growth curve for 16 consecutive years, pulled down Amorepacific and rose to the top in the industry.
According to the Financial Supervisory Service’s electronic disclosure system on the 3rd, Amorepacific Group announced that it recorded sales of 4.93 trillion won and operating profit of 150.5 billion won last year. Sales fell 21.5% and operating profit fell 69.8%.
Amorepacific, the flagship subsidiary, recorded sales of 4.43 trillion won and operating profit of 143 billion won last year. Compared to the previous year, sales decreased by 20.6% and operating profit decreased by 66.6%. Net profit fell 90.2% over the same period to 21.9 billion won.
In the fourth quarter of last year, AMOREPACIFIC’s sales were KRW 1.156.9 billion, operating loss was KRW 9.2 billion, and net loss was KRW 58.9 billion. The operating loss reflects the cost of retirement at the end of last year.
◆ AMOREPACIFIC failed to cross the’Corona Barley Pass’… In the end,
AMOREPACIFIC accepted the worst report card as the corona 19 crisis spread and the market such as duty free and road shops contracted sharply. Compared to LG H&H, it is said that due to the business portfolio focused on cosmetics, there was a lack of opportunity to produce separate results.
Last year, AMOREPACIFIC’s domestic sales fell 23.1% compared to the previous year to 2.7 trillion won, and overseas sales of 1.74.5 trillion won, down 16%. Operating profit decreased by 63% and 83% to 117.2 billion won in Korea and 17.9 billion won overseas, respectively. Sales of affiliates such as Innisfree, Etude, Espoir, Estra, and Amos Professional also decreased.
Sales of offline channels continued to decline compared to the previous year as the floating population decreased and shortened sales of some stores continued. As foreign tourists stopped taking steps, the duty-free channels continued to be sluggish. However, as the corona 19 crisis in China, the largest market, has truly entered a phase, the duty-free business has turned back to growth starting in the second half of the year.
Accordingly, Amorepacific Group is expected to focus on’reorganization’ this year. In the first quarter, the company plans to reorganize its business structure, including brand renewal, focus on e-commerce through offline business readjustment, and digital transformation from R&D to overall business management.
To this end, Amorepacific Group has also reorganized its internal organization, such as promoting its flagship brands Sulwhasoo and Laneige to the headquarters unit. In addition, it plans to expand digital marketing capabilities by strengthening collaboration with major e-commerce platforms such as Naver, 11th Street, Coupang, and Kakao. In addition, the effect of hopeful retirement, which was first implemented at the end of last year, is expected to appear.
Amorepacific Group official said, “By spurring on the improvement of the business structure, we will aim to achieve an operating profit of 5.6 trillion won and 380 billion won in sales this year.” “We will continue to improve the business structure for profitable growth. We will expand investment in new growth engines such as health functional foods and derma cosmetics.”
◆ LG Household & Health Care proved’Magic for the second seat’… Even cosmetics ranked first
On the other hand, LG H&H has succeeded in growth by minimizing the impact of Corona 19. In particular, even in the cosmetics market, it recorded only a single digit reduction rate even under the influence of Corona 19. Last year, LG H&H posted sales of KRW 7.84 trillion and operating profit of KRW 1.2 trillion, and net income of KRW 821.3 billion. All of them are of the highest level since inception.
The beauty division recorded sales of 4.58 trillion won, down 6.1% from the previous year, affected by Corona 19. This is 25.9 billion won ahead of Amorepacific. Operating profit decreased by 8.3% to 8228 billion won. The overall consumption stagnation was not avoided, but premium demand such as Hu, Ohui, and Soom in the Chinese market steadily increased, minimizing the damage.
The household products business division, such as shampoo, toothpaste, and body wash, recorded sales of KRW 1,873.3 billion and operating profit of KRW 25.3 billion. Sales increased by 25.9% and operating profit increased by 63%. The beverage division also increased by 4.3% and 26.2%, with sales of KRW 1.5132 billion and operating profit of KRW 192.9 billion, respectively.
In the end, it proved the’power of the portfolio’ divided into three fields, and even in the worst situation of the Corona 19 crisis, it has created a result that is the first to lead the’match’ AMOREPACIFIC.
An official from LG H&H said, “For the first time since the start of the business, all three businesses have achieved No. 1 in the domestic industry.”
Reporter Lee Hyun-seok [email protected]