Recently acquired by Ascent Equity Partners (Ascent EP) and Shinsegae Food, the color cosmetics ODM (original development manufacturing) specialist C&C International is accelerating the establishment of a new plant on the back of newly raised funds. C&C International saw orders slow last year and turned in weak results through the first half of this year, but thanks to increased overseas orders since early this year, it is also signaling an improvement in results in the second half.
According to related industry sources on the 22nd, C&C International recently changed its largest shareholder from Bae Eunchul and two others to Beauty Synergy Co., Ltd. through old-share sale contracts and a third-party paid-in capital increase. Through this transaction, Beauty Synergy's equity stake rose to 41.22% (5,618,748 shares). Beauty Synergy is an SPC (special purpose company) established by the domestic private equity manager Ascent EP. Shinsegae Food also invested 50 billion won in Beauty Synergy.
With this transaction, C&C International secured 145 billion won in proceeds from the new share issuance, speeding up its plan to build a new plant in Cheongju. Of the new share proceeds, the company plans to invest about one-third, or 45 billion won, in the Cheongju new plant and to use 100 billion won to acquire equity stakes in other entities and for other purposes.
The company currently owns plants in Hwaseong, Gyeonggi Province (head office·Purple County) and Yongin (Green County), and has a leased plant in Dongtan. Overseas, it has two plants in Shanghai, China. As of the end of last year, annual production capacity was 450 million units.
Keeping pace with the rapidly growing beauty market, C&C International plans to build integrated color and base cosmetics production facilities in Cheongju. To that end, it secured a plant site in 2023 for 27 billion won and carried out land development through the end of last year. In Aug., it signed an investment agreement with North Chungcheong Province and Cheongju City, securing administrative support and more.
The site for the new Cheongju plant, which breaks ground next month, is 19,361 pyeong, more than six times the combined sites of the existing domestic Hwaseong and Yongin plants. The company expects that when the new plant is completed in Mar. 2027, total annual production capacity will expand by 1 billion units from the current level to 1.45 billion units.
Han Yong-hee, a researcher at Growth Research, said, "C&C International plans to strengthen its competitiveness in base cosmetics through the new plant," adding, "In line with the trend of color and base cosmetics integrating, it is expected to secure the capability to launch new products such as functional color cosmetics."
C&C International posted first-half sales of 139.9 billion won and operating profit of 14.2 billion won. These figures were down 8.3% and 34.6%, respectively, from a year earlier. This was due to reduced product orders from major domestic clients last year and delays in container supply and the introduction of automation equipment.
However, backed by increased overseas orders in the first half, the company is signaling improved results in the second half. According to financial information provider FnGuide, C&C International was projected to record third-quarter sales of 76.9 billion won and operating profit of 9.7 billion won. This would mean sales up 3.8% and operating profit up 36.13% from a year earlier.
C&C International is increasing its overseas client base, centered on North American indie brands specializing in color cosmetics. The share of overseas orders, which had remained at 30%–40% last year, has recently risen to more than half. Lee Ga-young, a researcher at Samsung Securities, said, "In the color segment, exports by domestic indie brands to Western markets have not yet achieved significant success," adding, "C&C International's competitiveness is standing out as it supplies color products directly to Western brands."
The Shanghai subsidiary, which had continued to post losses last year, turned to profit in the first half of this year. In the first quarter alone, the Shanghai unit won new work equal to 84% of last year's total order volume. As a result, in the second quarter the Shanghai subsidiary recorded all-time high results with sales of 7.7 billion won and operating profit of 1.6 billion won.
C&C International, which has strengths in color cosmetics, plans to enter the skincare (base cosmetics) and hybrid fields starting this year and transform into a comprehensive ODM company. Through this, it aims to improve the average selling price and expand new orders at home and abroad.
A C&C International official said, "We are achieving diversification of the sales portfolio by expanding the skincare product lineup," adding, "Collaboration with global mega-brands is scheduled for the second half of this year, which should enable improved profitability."