Financial focus: Amorepacific, LG H&H and more feature in our latest beauty business and finance update
1 – Hot streak: LG H&H breaks financial records on the back of China’s unwavering appetite for luxury beauty
South Korean conglomerate LG Household & Healthcare has reported record-high sales and profits results driven by China’s demand for its luxury beauty products.
LG Household & Healthcare (LG H&H) is a consumer goods company that manufactures cosmetics, household goods, and beverages.
Brands in the company’s cosmetics portfolio include The History of Whoo, The Face Shop, Belief and Su:m37.
The company continues to feel the effects of the COVID-19 pandemic, with offline channels experiencing sharp decline in sales as a result of the plunge in tourism and store closures.
2 – Bouncing back: Strong demand for luxury beauty drives Amorepacific’s COVID-19 recovery
The demand for luxury beauty brands such as Sulwhasoo has helped to drive cosmetic firm Amorepacific’s recovery domestically and in overseas markets including China and Europe.
The company behind K-beauty brands Laniege, Innisfree and Sulwhasoo started to see its numbers improve in the first quarter of 2021.
In the first half of this year, the company recorded that its revenue was up 11.1% to KRW2.4tn, while its operating profit rocketed by 178.1% up to KRW267.5bn (U$233.1m).
Contrastly, Amorepacific reported that its revenue and operating profit plummeted by 23.1% and 65% respectively in the first half of last year.
3 – POLA pay off: ‘Super prestige’ brand’s 129% growth guides Pola Orbis to recovery
Japanese cosmetics company Pola Orbis Holdings has rebounded on the back of high-end flagship POLA, which posted remarkable operating profit growth of 129.2% in the first half of FY2021.
POLA is a luxury skin care brand specialising in skin ageing and brightening care owned by POLA Orbis, which is also behind well-known J-beauty brands such as ORBIS and THREE.
The remarkable growth was attributed to the company’s efforts to increase its contact points in the growth markets of China and travel retail. The emphasis on overseas sales resulted in a strong 55% growth year on year.
The strong performance was largely driven to the brand’s investments in China, where the company has been working to grow its presence.
4 – Sephora CEO: Feelunique acquisition a ‘key step’ in Europe growth strategy
Beauty retail major Sephora has confirmed its acquisition of prestige beauty e-commerce player Feelunique, with the deal expected to close between March and July next year.
Rumours of the deal started circulating this week, with LVMH-owned Sephora confirming the buy today. The transaction, subject to anti-trust clearance, was expected to close during the second semester of 2021, between March and July next year. Palamon Capital Partners had headed up the acquisition agreement alongside other shareholders.
The buy will see Sephora take on Feelunique’s 35,000-strong product cosmetic and fragrance portfolio and 1.3 million active customers.
Martin Brok, president and CEO of Sephora, said: “The transaction is a key step in Sephora’s European growth strategy and marks a first step for Sephora’s presence into the United Kingdom, one of the top-ten biggest prestige beauty markets worldwide, with a very high level of digital adoption.”
5 – Pressing ahead: Struggling Sa Sa finds respite in e-commerce progress as it endures sales dive
Beauty retail group Sa Sa International’s pivot towards e-commerce appears to be paying off as it recorded a year-on-year sales increase of 108.8% during the April to June quarter.
The pandemic and its repercussions on an already declining brick-and-mortar market has driven the firm to focus more investments in its online channels.
In 2019, for instance, it announced that decision to shut all 22 of its retail stores in Singapore as performance in the market had been unsatisfactory over the past few years. The company re-launched in Singapore a few months later via the e-commerce marketplace, Shopee.
The group’s online business has been improving steadily, with sales increasing 108.8% year-on-year in the first quarter. Compared to the FY2018/19 period, sales grew by a respectable 64%.