NewJeans Receives First Settlement Payment Two Months After Debut
Min Hee-jin Holds Emergency Press Conference Following HYBE's Lawsuit
Documents have been released suggesting that ADORE, which was under audit due to suspicions of attempting to become independent from HYBE, paid a total of 26.1 billion KRW to NewJeans members last year. According to data from the Financial Supervisory Service's electronic disclosure system on the 25th, ADORE's sales last year amounted to 110.3 billion KRW. This represents more than a fivefold increase compared to the previous year's sales of 18.6 billion KRW. Operating profit also rose significantly to 33.5 billion KRW, compared to a 4 billion KRW loss the previous year. Net profit, which is the amount remaining after deducting expenses and taxes from operating income, was 26.5 billion KRW.
This is the third highest sales figure among HYBE's 11 labels. Big Hit Music, home to BTS and Tomorrow X Together (TXT), recorded the highest sales at 552.3 billion KRW. Following that, Pledis Entertainment, which manages artists such as Seventeen and Fromis_9, posted sales of 327.2 billion KRW.
In February 1st, the girl group NewJeans attended the '2024 F/W Seoul Fashion Week' held at Dongdaemun Design Plaza in Jung-gu, Seoul. [Photo by Jinhyung Kang aymsdream@]
The amount NewJeans members are estimated to have received from ADORE is approximately 26.1 billion KRW. Last year, ADORE spent about 29 billion KRW on payment commissions. Excluding approximately 2.9 billion KRW classified as selling and administrative expenses, the remaining 26.1 billion KRW can be considered the amount settled with the affiliated artists. This implies that each of the five NewJeans members received about 5.2 billion KRW in settlements.
Earlier, Min Hee-jin, CEO of ADORE, also revealed that NewJeans received their first settlement just two months after debut. In an interview with Cine21 last year, CEO Min said, "Because we belong to a large company, there were claims that settlements would be fast unconditionally," adding, "Our settlements were not made because of my generous nature, nor because of HYBE's scale." She continued, "The settlements happened because the conditions for settlement were met," highlighting her achievements. CEO Min also said, "There has never been a team with three debut title tracks before," and added, "When I decided on three title tracks, all the members were surprised, but since I am both the producer and CEO, I was able to make that decision."
HYBE Transfers Partial Shares to ADORE Following NewJeans' Success
Hive is entering into conflict, including launching an audit of the management of Adore, a subsidiary to which the group NewJeans belongs. The photo shows the Hive headquarters in Yongsan. Photo by Jo Yongjun jun21@
As ADORE rapidly grew based on NewJeans' success, HYBE transferred part of its shares to ADORE last year. Until 2022, HYBE owned 100% of ADORE's shares but sold 20% last year. Currently, CEO Min holds 18% of the total shares, while the remaining 2% is owned by other executives of ADORE.
However, on the 22nd, HYBE announced that it had identified signs that CEO Min and other executives of ADORE attempted to seize management rights and initiated an audit. Following the announcement, conflicts between HYBE and ADORE deepened, causing HYBE's market capitalization to temporarily drop by about 850 billion KRW. Two years ago, HYBE's market cap had decreased by 2 trillion KRW when BTS announced a temporary suspension of activities, so investors are closely monitoring the current situation.
On the 25th, HYBE announced plans to file a complaint with investigative authorities against CEO Min and others on charges including breach of duty. HYBE stated that the audit of ADORE confirmed concrete facts and secured evidence indicating that a plan to seize management rights was led by CEO Min.
In response to HYBE's complaint, ADORE announced on the 25th that it would hold an emergency press conference to officially address the issues related to ADORE. They added that CEO Min would personally clarify her position regarding the situation. The emergency press conference by ADORE is scheduled to take place at 3 p.m. on the same day at the Korea Conference Center in Seocho-gu, Seoul.
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