11.5 billion won in operating loss, temporary effect from the sale of independent business
Cosmetics business surpassed 110 billion won in sales in all quarters for the first time
This year’s global, M&A, and organizational cultural innovations have resulted in a rebound in earnings
Shinsegae International recorded an operating loss last year. However, in the cosmetic business, it recorded the largest sales ever.
Shinsegae International announced on the 9th that sales of its continuing business (excluding lifestyle brands) increased 3.4 percent to 1.1 trillion won and 11.5 billion won in operating losses. If the independent sector is included, sales will increase 1.1% to KRW 1.32 trillion and operating profit to KRW 1.6 billion. The self-reliance project was transferred from Shinsegae Casa on January 1 this year.
An official from Shinsegae International said, “We have shown an operating loss on the disclosure due to the classification of the sale of independent businesses as discontinued operating profit or loss based on the Korean International Accounting Standards (K-IFRS), but it is a temporary effect and will be substantially offset from this year’s performance.” According to the explanation, only direct costs are reflected among the direct and indirect costs attributed to the existing business, and operating losses have occurred as the existing business bears additional costs, but this is a temporary effect and will be offset from this year.
Last year’s cosmetics business recorded the highest sales ever despite a slump in consumption. Cosmetics division sales rose 9.7% year-on-year to 455 billion won. For the first time since the start of the beauty business, all quarter sales have exceeded 110 billion won. In addition, sales have increased by more than double digits year-on-year in January this year, raising expectations for a rebound in earnings.
In the fashion sector, sales of domestic women’s and men’s clothes, which decreased consumption last year, have increased year-on-year since January of this year, and in the case of imported fashion, sales have increased by more than double digits, continuing high growth since last year.
Shinsegae International plans to maximize profitability and secure core capabilities to drive future growth through global business expansion, M&A, and growth-oriented organizational culture innovation this year.
Global businesses aggressively expand their distribution networks to Europe, the U.S., Japan, China, and Southeast Asia, starting with their beauty brands that have been confirmed to have growth potential such as Yeonjak, Vidivitch, and Amuse, speeding up sales volume.
It also plans to actively promote M&A and equity investments in brands with high growth potential in fashion and cosmetics, create new growth opportunities, and lay a solid foundation for growth through organizational cultural innovation and redesigning the capabilities of executives and employees.
It will also actively seek to increase shareholder value. The dividend for the 2025 fiscal year was set at 400 won per share, the same as the previous year, and the company plans to increase the value of its shares by incinerating 357,000 shares (about 1% of the total stake) last year out of 107.1 million treasury stocks (about 3% of the total stake) that completed the purchase in the first half of 2024.
“We continued to make investments for growth by pioneering global markets, rebranding, and securing distribution rights for new brands despite difficult business conditions last year,” an official at Shinsegae International said. “Based on the growth roadmap established this year, we will definitely achieve short-term performance improvement and mid- to long-term growth to increase corporate value.”
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