KB News Desk
Amorepacific, LG H&H post 53.3%, 87.5% second-quarter profit gains respectively
Korea’s two largest cosmetics companies, Amorepacific and LG Household & Health Care, posted double-digit second-quarter growth, much of it a story of waning reliance on China and waxing sales in North America.
Amorepacific Group on Thursday reported 1.25 trillion won ($873 million) in revenue and 122.8 billion won in operating profit, up 14.6 percent and 53.3 percent from a year earlier. Its main affiliate, Amorepacific, saw profit surge 59 percent.
The bulk of that gain came from abroad, where operating profit nearly doubled to 71.8 billion won, far outpacing the 48 percent growth recorded domestically. Momentum spread across online and offline channels in the US, Europe and Japan.
Its brands Laneige, Cosrx, Illiyoon and Mise en Scene each notched record sales during Amazon Prime Day in the US and Europe, the company said, while its dermatology label Aestura posted triple-digit sales growth in the US through Sephora and Amazon.
By contrast, China revenue declined, though the company continues to restructure around core channels to improve profitability.
LG H&H reported 1.66 trillion won in revenue and 102.8 billion won in operating profit, up 87.5 percent on-year. Beauty remained the standout division, generating 818.4 billion won in revenue and swinging to 44.4 billion won in operating profit.
The starkest evidence of its pivot came from North America, where revenue jumped 47.3 percent to 205.8 billion won, eclipsing China’s 176 billion won, down 5 percent, for the first time in the company’s history.
Apart from one-off tariff refunds, the company credited the improvement to premium-brand momentum and North American expansion. Its stable of brands, haircare label Dr. Groot, oral care line Euthymol and luxury cosmetics house the Whoo, gained ground both domestically and abroad.
The company also rolled out a reimagined identity for the Creme Shop at a US beauty exhibition, fusing Los Angeles cool with K-beauty sensibility to court younger American shoppers.
These results mark a sharp reversal from a few years ago, when a faltering Chinese economy, a wave of homegrown Chinese rivals and a collapsing duty-free channel battered both companies’ profits.
Amorepacific has downsized its China business and duty-free operations, slashing its China exposure from 54 percent in 2019 to 23 percent by 2024. LG H&H’s retreat was slower due to a heavier reliance on the Chinese market.
“China is still a crucial market, although K-beauty results no longer swing on it the way they used to,” one industry official said. “Companies that have rebalanced their growth around North America should see more stable results in the near term.”
