NS Home Shopping, Poor Performance Due to Disaster Relief Fund Passing in Q2

Transaction Amount and Sales Decrease by 0.2% and 5.1% QoQ
Impact of Disaster Relief Fund Usage Restrictions, etc.

[Asia Economy Reporter Cha Min-young] NS Shopping, which operates NS Home Shopping, recorded sluggish performance in the second quarter amid the ongoing COVID-19 pandemic and the impact of restrictions on the use of emergency disaster relief funds.

NS Shopping announced on the 7th that its separate operating profit for the second quarter was tentatively estimated at 16.2 billion KRW, a 10.5% decrease compared to the previous year. Net profit also decreased by 7.6% to 11 billion KRW. The transaction amount increased by 9.0% year-on-year to 369.1 billion KRW, and sales rose by 11.1% to 133.5 billion KRW.

By business segment, the transaction amount was highest in TV at 216 billion KRW, followed by mobile (94.3 billion KRW), catalog (37.8 billion KRW), internet (20.4 billion KRW), and others (0.6 billion KRW). While mobile transaction amount increased by 34.1% compared to the previous year, internet transaction amount decreased by 10.9%.

The results are somewhat disappointing compared to the strong performance in the first quarter, which was the early stage of the COVID-19 situation. In fact, second-quarter operating profit decreased by 10.0% compared to the previous quarter, and net profit dropped by 20.9%. Transaction amount and sales also declined by 0.2% and 5.1%, respectively.

A company official explained, "With the company's food sales accounting for more than 50%, food sales significantly decreased in the second quarter as home shopping was excluded from the government’s emergency disaster relief fund usage."