Operating Profit of 8.2 Billion KRW Last Year
"Turned Profitable as High-Margin Product Sales Share Increased"
Lotte Hi-Mart announced on the 24th that its annual operating profit last year reached 8.223 billion KRW, marking a turnaround to profitability compared to the previous year.
During the same period, sales amounted to 2.6101 trillion KRW, representing a 21.8% decrease compared to the previous year. Net loss for the period was 27.217 billion KRW, improving by 94.8% year-on-year.
Regarding last year's performance, Lotte Hi-Mart stated, "Sales declined compared to the same period last year due to the ongoing recession," but added, "We improved profitability through inventory normalization based on the product grading system and achieved a turnaround to annual operating profit by increasing the sales proportion of high-margin product groups such as kitchen and seasonal appliances, as well as private brand (PB) products."
On a quarterly basis, the company reduced its deficit in the fourth quarter of last year. Lotte Hi-Mart's operating loss in Q4 last year was 10.033 billion KRW, reducing the deficit by 77.6% compared to the same period last year. Sales during the same period were 578.546 billion KRW, down 21.2%. Net loss also decreased by 74% year-on-year to 38.381 billion KRW.
Lotte Hi-Mart explained that the turnaround to operating profit last year was the result of business structure improvement efforts. A company representative said, "Despite the continued difficult market conditions, we saw results such as a more than 20% sales growth in renewed stores along with improved profitability." The company carried out renovations of 43 stores last year while strengthening its home appliance care service, 'Home Mannung Haegyeol Service.'
Lotte Hi-Mart aims to make this year a 'turnaround' year. Specifically, the Home Mannung Haegyeol Service will expand its products and categories, and complete the renewal of PB products. About 70 stores will be renewed and reopened this year, introducing category-specialized stores and consultation-type specialty stores. The e-commerce division also plans to launch a home appliance specialized e-commerce platform featuring an 'ON-OFF remote consultation system' where customers can purchase products and services.
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