The South Korean consumer goods giant announced on April 25 that its first quarter (Q1) sales and operating profit have returned to growth.
This is the first time since the first quarter of 2023 that LG H&H has recorded positive sales, and its operating profit has increased for the first time since the third quarter of 2021.
Sales of beauty products increased by 5.6% to 741 billion won (US$538.9 million), and operating profit rose 3.1% to 63 billion won (US$45.8 million).
This is thought to be due to the company’s efforts to renew its main luxury beauty brand “The Who,” which accounts for the largest share of beauty product sales at 52%.
The company embarked on a complete rebranding by refining its strategic direction, strengthening its product competitiveness and strengthening its brand communication.
New product innovations include improved Cheongidan serum and Bichup serum. The latter was the first time the company applied its proprietary His NAD+ ingredient.
According to the company, these products are selling well.
She emphasized that the brand achieved single-digit growth even in the weak Chinese beauty market.
This was led by The Whoo, which saw double-digit sales growth in China.
The beauty division also includes brands such as The Face Shop, Belif, and CNP Laboratories.
In addition to The Who’s new product development, the company also saw positive results from the introduction of Verif’s updated Aqua Bomb and Moisturizing Bomb, and the introduction of CNP’s new sunscreen.
Last quarter, the beauty division’s sales fell 23.7% to 664 billion won (US$482.8 million), and operating profit fell 90.8%. Up to 7 billion won (5.09 billion USD).
LG H&H CEO Lee Jung-ae previously emphasized that LG H&H is at a critical stage in 2024.
“2024 should be a turning point for LG H&H, breaking away from the stagnation of the past two years and ushering in a new era of growth.” she said.
Popular brands slightly declined
Meanwhile, sales of Home Care & Daily Beauty decreased by 1.7% to KRW 553 billion (US$402.1 million), but operating products increased by 8.3% to KRW 35.4 billion (US$25 million).
This segment primarily consists of mass personal care products, including oral care brand Euthymol and hair care brand Dr. Groot.
Brands such as Physiogel, Dr. Groot and Peiroe reported increased sales due to new product launches.
However, despite the growth of these brands, sales declined. “Overseas business restructuring” said the company.
Apart from beauty and personal care, sales of the company’s beverage business increased by 3.6% to KRW 434 billion (US$315.4 million), and operating profit increased by 1% to KRW 53 billion (US$38.5 million).
Overall, company-wide sales increased 2.7% year-on-year to 1,728.7 million won (US$1.257 billion), and operating profit increased 3.5% to 151 billion won (US$109.8 million).
