K-beauty Indie Brand Export Boom Drives Cosmecca Korea's Q2 Operating Profit Up 27.2%

Second Quarter Sales Reach KRW 161.7 Billion... Up 12.5% Year-on-Year

Cosmetic ODM (Original Development Manufacturing) company Cosmecca Korea achieved solid results in the second quarter of this year. This performance is attributed to the strong popularity of K-beauty indie brand clients in overseas markets.

According to the Financial Supervisory Service's electronic disclosure system on August 11, Cosmecca Korea's consolidated operating profit for the second quarter was KRW 23 billion, up 27.2% year-on-year. During the same period, sales reached KRW 161.7 billion, an increase of 12.5% compared to the previous year.

This performance is analyzed to be the result of increased order volumes as K-beauty indie brands gained significant popularity in overseas markets. The Korean subsidiary led sales growth, with sales of KRW 110 billion in the second quarter, up 16.2% year-on-year. The company explained that the expansion of export regions for K-beauty indie brands, diversification of the customer portfolio, and a wider range of product categories drove the increase in sales. In particular, sales of color cosmetics grew by 20.9% compared to the same period last year. Thanks to a stable sales structure centered on skincare products and operating leverage effects, operating profit reached KRW 13.8 billion.

Englewood Lab, the company's U.S. subsidiary, recorded sales of KRW 57.5 billion and operating profit of KRW 10.1 billion in the second quarter. Growth was driven by increased orders for sun care products from new clients and large-scale orders from U.S. indie brands. The effects of investments in automation facilities at the Totowa, New Jersey site in the U.S. and the Incheon production base in Korea were also partially reflected, contributing to improved cost structure and enhanced production efficiency, which in turn improved profitability.

Cosmecca China, the company's Chinese subsidiary, posted sales of KRW 8.6 billion and an operating loss of KRW 1.1 billion in the second quarter. The company stated that it is strengthening data-driven, customized proposal sales by utilizing TikTok and key statistical platform data to identify products and concepts for each client. In addition, the proportion of color cosmetics sales expanded to 56.8%, and with the launch of new cushion products, color cosmetics sales increased by 30.5% year-on-year, showing signs of a turnaround.

Cho Imrae, Chairman of Cosmecca Korea, said, "As regulations are being strengthened in major markets such as Europe, the United States, and China, the value of the ODM model is becoming increasingly prominent," adding, "We will leverage our expertise and experience to help K-beauty indie brands secure competitiveness in the global market."