[Click eStock] "Amorepacific Emerges as a Promising Performer Through Intensive Restructuring"

On December 26, DB Securities projected that Amorepacific would emerge as a promising performer, as its intensive organizational restructuring is expected to enter the final stage in the first half of next year. The firm maintained its "Buy" rating and a target price of 150,000 won.

For the fourth quarter of this year, Amorepacific’s consolidated sales are estimated at 1.1217 trillion won (up 2.8% year-on-year), with operating profit at 98.1 billion won (up 25%), which is expected to meet market expectations. Heo Jena, a researcher at DB Securities, stated, "While one-off costs will occur due to workforce optimization focused on inefficient domestic channels, the company is expected to deliver results in line with consensus, excluding these factors."

Amorepacific’s overseas cosmetics business is also anticipated to see steady sales growth next year, particularly in North America and Europe. Heo explained, "In the United States, Laneige’s growth momentum will continue, and incubation efforts for the Aestura brand will begin in North America and Europe." She added, "In China, the company plans to proactively reduce low-efficiency Sulwhasoo department store outlets by the first half of the year, which should enable further fixed cost reductions." COSRX is also showing signs of a gradual recovery starting in the fourth quarter of this year, following a period of sluggish performance.

Heo noted, "Restructuring efforts for inefficient domestic channels with high fixed costs and the offline business in China are expected to be completed by the first half of 2026. If Aestura gains traction in Western markets and Laneige in China next year, Amorepacific’s global brand portfolio will be further diversified, and meaningful earnings growth is likely to continue."