Laughed at the 'King Dollar'... Export Medical Device Industry "Expecting Record-Breaking Performance"

Skin Beauty Medical Device Companies Q3 Performance Up
Exports Increase Despite Traditional Off-Season, Showing Strong Results
"Companies with High Export Ratios Benefit from High Exchange Rates"

Lutronic's newly released aesthetic medical device 'Derma V' this year [Photo by Lutronic]

[Asia Economy Reporter Lee Gwanju] The domestic medical device industry, which has expanded exports amid the ongoing 'King Dollar (global dollar strength)' phenomenon this year, is smiling. As the pace of global market penetration accelerates and the exchange rate effect is reflected, there are expectations for record-breaking performance.

According to the related industry on the 15th, medical device companies recorded consecutive strong performances in the third quarter of this year. Lutronic, which specializes in laser and skin beauty medical devices, posted consolidated sales of 64.3 billion KRW in the third quarter, a 56.5% increase compared to the same period last year. Operating profit and net profit reached 9.5 billion KRW and 15.4 billion KRW, respectively, increasing by 67.5% and 62%. The cumulative sales from the first to the third quarter alone reached 183.6 billion KRW, already surpassing last year's total sales (173.6 billion KRW), indicating that this year will mark the highest sales ever.

This growth trend originated from overseas sales. Lutronic's U.S. sales in the third quarter reached 30.5 billion KRW, the highest quarterly figure, accounting for about half of total sales. Compared to the same period last year (13.3 billion KRW), this is a 130.5% increase. Growth in the Europe and Middle East regions also continued, with overall overseas sales growth reaching 74.1%.

Skin beauty medical device company Classys also recorded strong third-quarter results. Consolidated sales were 33.3 billion KRW, a 36% increase compared to the same period last year, and operating profit was 17.5 billion KRW, up 32% during the same period. Exports particularly drove sales growth. Classys' third-quarter export amount alone was 22.9 billion KRW, a 30% increase compared to the same period last year, with steady sales growth in various overseas markets such as Brazil, Japan, Thailand, and Australia.

Classys Shurink Universe. [Photo by Classys]

The skin beauty medical device sector, represented by lasers, is considered a typical off-season in the third quarter. Since sales are mainly made to hospitals and clinics, purchases usually occur at the end and beginning of the year (fourth and first quarters), and beauty treatments are mostly performed during summer and winter vacations, leading to a tendency for third-quarter sales to decline.

Nevertheless, the record quarterly performance is analyzed to be largely due to the industry's export expansion efforts combined with the strong dollar effect. The average won-dollar exchange rate in the third quarter this year was 1,338 KRW, about 180 KRW higher than the third quarter last year (1,157 KRW). A Lutronic official explained, "The third quarter is traditionally an off-season, but we continued growth by organizing a lineup of high-priced, high-margin products, and the exchange rate effect contributed to achieving high sales."

JVM, a subsidiary of Hanmi Science specializing in automated drug preparation and management devices, also surpassed cumulative sales of 100 billion KRW for the first time since its establishment up to the third quarter this year. Looking at the third quarter alone, consolidated sales were 34.2 billion KRW and operating profit was 5.7 billion KRW, increasing by 11.7% and 61.8% respectively compared to the same period last year. Expanding export markets to North America, Europe, and South America, third-quarter export sales reached 16.2 billion KRW, a 12.5% growth compared to last year. Hanmi Pharm, responsible for JVM's overseas sales and marketing, currently sells JVM products in 59 countries based on cooperation with 33 global partners.

The majority of the domestic medical device industry is focusing on expanding exports, as the domestic market alone clearly has scale limitations. According to the global market research firm Fitch Solutions, the Korean medical device market size is around 10 trillion KRW, ranking within the top 10 worldwide, but the U.S. market is about 190 billion USD (approximately 250 trillion KRW), about 25 times larger. An industry official said, "Many medical device companies have a large export ratio in their sales," adding, "The high exchange rate is a boon for companies focusing on exports."