Emart Surpasses 100 Billion KRW Operating Profit in Q1 Riding On-Offline Synergy

Discount Store Sales Increase by 8.0%... SSG.com Improves Deficit by 16.6 Billion Won

[Asia Economy Reporter Jo In-kyung] Emart achieved a significant improvement in performance by surpassing 100 billion KRW in quarterly operating profit for the first time in three years, driven by balanced growth both online and offline.

According to Emart's Q1 earnings announced on the 13th, consolidated operating profit was preliminarily estimated at 123.2 billion KRW, a 154.4% increase compared to the same period last year. This marks the first time in three years since recording 153.5 billion KRW in operating profit in 2018 that it has exceeded the 100 billion KRW mark again.

Sales reached 5.8958 trillion KRW, up 13.1% year-on-year, and net profit increased by 129.4% to 102.1 billion KRW.

By business segment, discount store sales increased by 8.0% to 3.0019 trillion KRW, and operating profit rose by 6.9% to 91.2 billion KRW. This was largely attributed to the increase in same-store sales growth to 7.9%, thanks to strategies strengthening the competitiveness of offline stores. Traders' sales were 838.7 billion KRW, and operating profit was 24 billion KRW, up 25.0% and 37.9% respectively compared to the same period last year.

Even in April, considered an off-season for large marts, total monthly sales reached 1.2476 trillion KRW, a 7.0% increase year-on-year, supported by sales growth in discount stores and Traders.

Major subsidiaries such as SSG.com and Emart24 also showed improved performance. SSG.com, Shinsegae Group's integrated online mall, posted Q1 sales of 337.1 billion KRW, up 9.8%. Operating losses narrowed by 16.6 billion KRW to 3.1 billion KRW. Convenience store Emart24's sales increased by 19.4% to 423 billion KRW, and operating losses decreased by 2.7 billion KRW to 5.3 billion KRW.

Shinsegae Food turned profitable with an operating profit of 5.1 billion KRW. Shinsegae TV Shopping, Shinsegae Property, and Shinsegae I&C also maintained profitability.

An Emart official said, "With balanced growth in both offline and online sectors, we achieved operating profit exceeding 100 billion KRW for the first time in three years. We will continue to grow by enhancing store competitiveness and strengthening online-offline synergy."

Meanwhile, Starfield Hanam, an equity-method affiliate of Emart, recorded Q1 sales of 30.5 billion KRW, up 9.7% year-on-year, and operating profit of 13.2 billion KRW, up 16.8%. Notably, Starbucks Coffee Korea's Q1 sales reached a record high of 522.7 billion KRW, a 15.0% increase, with operating profit rising 72.6% to 45.4 billion KRW and net profit increasing 77.8% to 33.6 billion KRW.

As of Q1, the number of Starbucks stores in Korea was 1,536, an increase of 28 stores from 1,508 at the end of last year. A Starbucks Korea official explained, "The base effect due to the spread of COVID-19, along with increased use of non-face-to-face services such as delivery-only stores, drive-thru, and Siren Order, contributed to this growth."