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Amorepacific Q3 net down 93% on tepid sales amid pandemic

(Amorepacific Corp.)
(Amorepacific Corp.)
Amorepacific Corp. said Wednesday its third-quarter net profit declined 93.1 percent from a year earlier as sales of its cosmetics at offline channels were hit by the new coronavirus outbreak.

Net income came to 7 billion won ($6.2 million) in the July-September period, compared with 102.3 billion won a year earlier, South Korea's largest cosmetics maker said in a regulatory filing.

From three months earlier, net profit rose 4.6 percent.

Operating profit declined 48 percent on-year to 56 billion won and revenue fell 22.4 percent to 1.08 trillion won.

The operating profit was 47.8 percent higher than the average estimate, according to the survey by Yonhap Infomax, the financial data firm of Yonhap News Agency. The estimate of net profit was not available.

"Operating profit fell as sales remained tepid at offline channels, including duty-free shops, department stores and budget cosmetics outlets, amid the protracted COVID-19 pandemic," the company said in a statement.

The virus outbreak has hit local cosmetics makers' sales at duty-free outlets, a key sales channel of local cosmetics makers, and other offline outlets.

Amorepacific said domestic sales declined 28 percent on-year to 672.7 billion won while its overseas sales posted a 13 percent on-year fall to 423.2 billion won.

To prop up sales, Amorepacific has been beefing up its online sales channel and focused on enhancing marketing of its luxury brands, including Sulwhasoo.

The company also reduced the number of its offline stores of eco-friendly brand Innisfree in China as part of its restructuring efforts.

Online sales of its luxury brands, including Sulwhasoo, in China jumped more than 80 percent, it said.

Amorepacific Group, parent group of the cosmetics maker, logged a net profit of 7 billion won in the third quarter, down 93.7 percent from the previous year. (Yonhap)