이 기사는 2021년 07월 12일 07:38 thebell 에 표출된 기사입니다.

Lotte Duty Free, Hotel Lotte's duty-free unit, handed over a large amount of its duty-free goods to individual merchants who purchase duty-free items in bulk, but it caused account receivable worth about 10 billion won ($8.7 million), resulting in an internal audit.

Lotte Duty Free sold a large amount of duty-free goods to daigongs, which refer to individual merchants who purchase tax-free goods in South Korea and sell them in China, but failed to properly collect the money, resulting in account receivable of 10 billion won, industry sources said Thursday.

This caused an audit by the internal ethical management team and positions of some employees have been changed as a primary measure, according to source.

Lotte Duty Free recorded revenue of 3.15 trillion won in 2020, a 48.4% drop year-on-year, due to the outbreak of Covid-19. As sales of duty-free goods, which account for more than 80% of Hotel Lotte's revenue, plummeted, its revenue on a consolidated basis also dropped and the hotel swung to a loss compared to a year earlier.

The duty free operator postponed its plan to open outlets in an airport and downtown Vietnam. It also withdrew its business from Taiwan.

Meanwhile, Hotel Lotte is preparing for an initial public offering as part of Lotte Group’s move to convert into the holding company system, which has been carried out since 2015. The group plans to reduce a stake in Hotel Lotte owned by Lotte Japan through a listing and merge with Lotte Corp to incorporate affiliates into the holding company.

For this to happen, Hotel Lotte has to increase its corporate value through Lotte Duty Free’s growth. Hotel Lotte was very close to listing its shares in 2016, but the process has been delayed for six years due to the prosecution's investigation into management corruption and the THAAD incident, followed by the Covid-19 pandemic.

Earlier this year, Lotte Duty Free announced that it will exit from Taiwan and Thailand and focus on the Vietnamese market which has stronger growth potential. It also planned to open two stores in downtown Da Nang and Hanoi in the second half of this year.

However, revenue from domestic outlets didn’t show signs of recovery due to prolonged pandemic. Lotte Duty Free posted 766.7 billion won in revenue in the first quarter, a 12.1% decrease from a year ago.

Lotte Duty Free is estimated to have sold duty free goods worth around 30 billion won to daigongs in June, but failed to receive some of the payments.

As a result, heads of each business division, including head of the sales department, have been changed. Head of the sales department has been replaced from a managing director to a manager.

“We recently conducted personnel reshuffle, but it is not a big change considering the total number of executives,” said an official at Lotte Duty Free. “We are currently carrying out an inspection to find an internal cause and improve our system.” (Reporting by Seon-ho Kim)