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Shinsegae Intl gets boost from Swiss Perfection acquisition Korean company’s overseas cosmetics business remains profitable thanks to Swiss brand

Translated by Ryu Ho-joung 공개 2022-05-26 08:10:40

이 기사는 2022년 05월 26일 08:03 더벨 유료페이지에 표출된 기사입니다.

Shinsegae International Inc, a South Korean fashion and cosmetics company, has increased its overseas cosmetics sales in the first quarter, thanks to the acquisition of Swiss Perfection.

Shinsegae International posted consolidated revenue of 352.2 billion won ($278.8 million) in the January-March quarter, up 3% year-on-year, primarily driven by improved performance in its domestic fashion and lifestyle business. Operating profit rose 55.6% to 33 billion won in the same period.

The Seoul-based company’s business consists of three areas: fashion, cosmetics, and lifestyle brand JAJU. Cosmetics was a high-margin business for Shinsegae International, representing 81% of the company’s total operating profit in 2019, which was before the Covid-19 pandemic.

However, with a relatively high reliance on duty-free sales, the company’s cosmetics business was hit hard by the pandemic. To diversify its cosmetics portfolio and expand across geographies, Shinsegae International acquired 100% of PP Produits Prestiges SA, which owns cosmetics brand Swiss Perfection, for 24.9 billion won in December last year.

Swiss Perfection generated 1.6 billion won in operating profit on revenue of 3 billion won in the first quarter of this year. This means the company’s overseas cosmetics business, which made an operating profit of a mere 143 million won overall, would have turned unprofitable in the quarter without the Swiss brand.

Shinsegae International seeks to better position itself to benefit from the economy reopening from the pandemic. It has continued to step up efforts to diversify its cosmetics portfolio, launching premium brand Poiret last year.

“Our overseas cosmetics sales jumped thanks to the acquisition of Swiss Perfection,” an official at Shinsegae International said.

“We have continued efforts to find future growth drivers for our cosmetics business despite the Covid crisis by acquiring Swiss Perfection and launching Poiret.” (Reporting by Seon-ho Kim)
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