Largest Profit Ever
AmorePacific Group (chairman Suh Kyung-bae) saw its profits hit a record high last year.
The company announced on Feb. 3 that its operating profits in 2014 went up 40.3 percent to 659.1 billion won (US$599.62 million) from the same period a year earlier.
Its sales also went up 21 percent to 4.7119 trillion won (US$4.29 billion) from the same period a year earlier. The sales of AmorePacific, a major subsidiary of the group, recorded 3.8740 trillion won (US$3.52 billion), showing 25 percent growth. Its operating profit was increased by 52.4 percent to 563.8 billion won (US$512.92 million). The results improved largely because the company strengthened its brand power, improved its distribution channels, and expanded its overseas businesses.
The domestic cosmetics business grew 23.5 percent to 2.5789 trillion won (US$2.35 billion). The major outlets, including duty-free stores, e-commerce, and Aritaum, contributed to the rise in sales.
The overseas cosmetics business increased 52.8 percent to 832.5 billion won (US$757.37 million). Particularly, thanks to the improvement of brand awareness and the diversification of outlets, the business in the Chinese market grew 44 percent to 467.3 billion won (US$425.13 million).
The group also accomplished a turn into profit-making in other Asian markets. As Innisfree made inroads into the major Asian markets of including Singapore, Malaysia, and Taiwan, the company secured a growth engine. Moreover, AmorePacific acquired a joint venture in Hong Kong and strengthened its position in the market.
In the U.S. market, the company saw high growth in sales and a turnaround in its operating profits. Sales showed stable growth across all the outlets, including department stores, Sephora, and e-commerce. Also, Laneige opened stores at Target, the second-largest American discount retailer.
In the French market, sales slightly decreased due to the economic slump in Europe. However, the company reduced its deficits through efficient cost management. Also, sales showed a small drop in the Japanese market due to the reorganization of the brand and the channel portfolio.