LG H&H said on the 10th that third-quarter sales this year came to 1.58 trillion won, with operating profit of 46.2 billion won. Compared with the same period a year earlier, sales fell 7.8% and operating profit dropped 56.5%. Weakness in the cosmetics (beauty) institutional sector weighed on results.
By business, sales in the beauty institutional sector were 471 billion won, down 26.5% from a year earlier, and it posted an operating loss of 58.8 billion won. Profitability deteriorated during efforts to streamline channels, including adjusting the duty-free distribution network and reducing volumes for key brands.
During the same period, sales in the household goods institutional sector rose 4.1% to 596.4 billion won, and operating profit increased 6.8% to 42.4 billion won. Sales in the beverage institutional sector grew 2.4% to 512.5 billion won, with operating profit up 16.9% to 62.6 billion won.
Overseas sales were 493 billion won, up 6.6% from a year earlier. By region, sales in North America and Japan rose 21.1% and 6.8%, respectively, while sales in China fell 4.7%.
An LG H&H official said, "The 'beauty' business overhaul is a process that is absolutely necessary for a new leap forward," adding, "With new leadership, we will work to enhance business competitiveness and restore mid- to long-term performance."
LG H&H held an extraordinary shareholders meeting and a board meeting that day and appointed Lee Seon-ju, formerly of L'Oréal, as the new CEO. The new chief is credited with growing brands such as Kiehl's, Yves Saint Laurent, and MEDIHEAL over 30 years in the domestic and overseas cosmetics industry.