Cosmax Achieves Huge Sales Thanks to Indie Brands... China Slump Remains 'Unchanged'

Indie Brand's New Clients, Increased Exports to US and Japan
7.5% Decrease in Consolidated Sales of China Corporation

Cosmax, a company specializing in Original Design Manufacturing (ODM) for cosmetics, announced on the 11th that its consolidated operating profit for the third quarter of this year was preliminarily estimated at 43.413 billion KRW, a 30.4% increase compared to the same period last year. However, the Chinese market continued to experience sluggishness due to a decline in sales.

During the same period, sales grew by 15.6% to 529.832 billion KRW, and net profit increased by 90% to 20.618 billion KRW.

Cosmax CI. Provided by Cosmax

Looking at each corporation, the Korean corporation’s sales increased by 20.8% year-on-year to 347.8 billion KRW, and operating profit rose by 52.7% to 39.5 billion KRW. The domestic corporation achieved strong results as new customers increased due to the success of small and medium indie brands, while exports to the US and Japan from existing customers also grew.

By product category, steady growth was recorded across all categories, including basic cosmetics and color cosmetics. In particular, products with UV protection functionality accounted for about 20% of total product sales. Among basic cosmetics, essences, cleansing products, and mask packs, as well as color cosmetics such as sun cushions and lip care products, showed nearly double the growth compared to last year.

Additionally, order volumes increased due to the influx of new indie brand customers and portfolio diversification. Existing customers also increased export volumes to the US and Japan.

The consolidated sales of the Chinese corporations (Shanghai, Guangzhou, and Easen JV) recorded 114.4 billion KRW, a 7.5% decrease compared to the same period last year. This is interpreted as being influenced by the sluggish local economy in China. The retail sales of cosmetics in China for the third quarter of this year decreased by 6% year-on-year. However, sales of major brands such as Perfect Diary, a key brand of Easen, grew. Guangzhou corporation’s sales increased by 7.6% year-on-year due to the growth in Easen JV sales.

Sales of the US corporation recorded 32.5 billion KRW, down 11.8% from the same period last year. The US corporation officially opened its California sales office in the third quarter and continues to promote localization efforts such as supporting indie brands. Currently, it is conducting new projects with more than 10 customers.

Sales of the Indonesian corporation increased by 37.9% year-on-year to 32.3 billion KRW, and sales of the Thai corporation rose by 69.8% to 11.1 billion KRW. Strong sales were seen from local customers and across all product categories including basic, makeup, and men’s cosmetics.

A Cosmax official stated, "As the preference for K-beauty products increases in the global market, we recorded strong performance for three consecutive quarters, supported by the effect of increased exports," adding, "In the second half of the year, we will secure competitiveness through diversification of global business and solidify our position as the No.1 cosmetics ODM."