LG Household & Health Care Q2 Operating Profit 158.5 Billion KRW... Up 0.4% YoY

Sales of 1.7597 trillion KRW... 2.7% decrease
Operating profit in household goods sector up 22.8% YoY

LG Household & Health Care announced on the 25th that its consolidated operating profit for the second quarter of this year was preliminarily estimated at 158.5 billion KRW, a 0.4% increase compared to the same period last year.

During the same period, sales decreased by 2.7% to 1.7597 trillion KRW, while net profit increased by 11.2% to 102.7 billion KRW. LG Household & Health Care explained that both sales and operating profit generally met the securities firms' earnings forecasts.

LG Household & Health Care logo. [Image provided by LG Household & Health Care]

As a result, LG Household & Health Care's sales for the first half of this year were preliminarily estimated at 3.4884 trillion KRW, a 0.1% decrease compared to the same period last year. Operating profit increased by 1.9% to 309.6 billion KRW, and net profit rose by 14.3% to 220.3 billion KRW.

Regarding the first half performance, LG Household & Health Care stated, "The strengthening of digital capabilities in key markets such as Korea, China, and North America has translated into results, and the turnaround of the North American business is becoming visible."

Looking at the second quarter performance by business segment, sales in all sectors?▲Beauty, ▲Home Care & Daily Beauty (HDB), and ▲Refreshment?slightly declined. However, operating profit increased in the Beauty and Home Care segments. The Beauty business saw a 22.8% increase in operating profit, driven by the growth of premium brands such as Physiogel, Dr.Groot, and Usimol, as well as the effects of overseas restructuring.

The Beauty segment's second quarter sales were 759.6 billion KRW, down 2.7% year-on-year, while operating profit rose 4.0% to 72.8 billion KRW. For the first half, sales increased 1.3% to 1.5006 trillion KRW, and operating profit grew 3.6% to 135.8 billion KRW compared to the same period last year.

In the second quarter, the Beauty business saw increased sales of the 'THE WHOO' brand through online channels and continued growth in the Chinese market. Domestic online and health & beauty (H&B) channels also showed sales growth. However, duty-free sales declined due to a slowdown in the market and base effects. Operating profit grew reflecting the impact of overseas restructuring.

In April, LG Household & Health Care hosted a global launch event for THE WHOO’s ‘Bicheop JaSaeng Essence 4th Generation’ by inviting domestic and international influencers, and held the ‘K-Bicheop Tour,’ significantly strengthening THE WHOO’s global marketing. New products included the renewal of THE WHOO’s ‘Bicheop Circulation Essence’ and the launch of ‘Supernights Pack Cleanser,’ a low-irritant vegan product that combines a pack and cleansing in one, under the brand belif.

The Home Care & Daily Beauty (HDB) segment recorded second quarter sales of 521.5 billion KRW, down 4.5% year-on-year, while operating profit increased 22.8% to 33.9 billion KRW. For the first half, sales decreased 3.1% to 1.0748 trillion KRW, and operating profit rose 14.9% to 69.4 billion KRW compared to the same period last year.

The Home Care segment’s operating profit grew by more than 20%, reflecting sales growth of key premium brands and the effects of overseas restructuring. In Daily Beauty, a new high-performance body care solution brand, 'BeClinicX,' was launched. FiJi and AURA introduced premium indoor drying lineups.

The Refreshment segment’s second quarter sales were 478.6 billion KRW, down 0.5% year-on-year, and operating profit decreased 13.9% to 51.8 billion KRW. For the first half, sales increased 1.4% to 913 billion KRW, while operating profit declined 7.0% to 104.4 billion KRW compared to the same period last year.

Although sales of key products such as Coca-Cola Zero, Monster Energy, and Powerade continued to grow, the beverage business was affected by sluggish domestic demand and bad weather, which reduced beverage consumption. Operating profit also declined due to rising raw material costs and intensified competition in the beverage market.

In the second quarter, the company strengthened its zero portfolio by launching various new products aligned with market and seasonal trends. Toreta released 'Toreta Zero,' and Coca-Cola introduced 'Coca-Cola Zero Cherry,' combining Coca-Cola Zero with cherry flavor. The low-calorie peach-flavored sports drink 'Powerade Scarlet Storm' was also launched in the second quarter.