11 Amorepacific - Beauty Packaging Magazine

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: $5.7 billion

Suh Kyung-bae, chairman and chief executive officer; Bae Dong-Hyun, president and co-chief executive officer.

Skin care—Sulwhasoo, Laneige, Mamonde, Innisfree, Hera, Iope, Happy Bath, Primera, Odyssey, Illi, Lirikos, Aestura, Makeon; Cosmetics—Etude, Hanyul, Espoir, Aritaum; Fragrance—Annick Goutal. Inner Beauty: Vital Beauty; Hair Care—Ryo, Mise-en-Scéne.

Luxury—Sulwhasoo Timetreasure, Bloomstay Vitalizing Eye Cream, Hera Glow Lasting Foundation, Sienu; Premium—Laneige Radiant-C Cream, Iope Retinol Expert 0.1%, Hanyul Red Rice Essential line, Iope Tailored 3D Mask; Daily Beauty—H hair care; Enough Project

Amorepacific enjoyed a modest boost of 3.4% in sales in 2019, led by the domestic cosmetic sales of its popular Sulwhasoo luxury brand, as well as its Ryo hair care line and online interest in newer brands such as Illiyoo and Fresh Pop.

A deeper dive revealed Innisfree revenue dipped 8% due to declined revenue in road shops and travel retail. And despite posting online sales growth, the Etude brand saw revenue drop 18% in 2019 with mitigated losses as a result of closing down directly owned stores to reduce expenses. Amos Professional’s sales also declined 1%, which the company attributed to strong competition in the hair care market.

In better news, Espoir sales climbed 11% thanks to seasonal makeup sales, reduced expenditures and improved sales promotion communication with consumers. Aestura sales also rose 11%, driven by the sales of 365, a new skin care line.

Last year the company continued to further its commitment to lessening its environmental footprint. On the heels of its 2018 agreement with TerraCycle, Amorepacific strengthened its sustainability management efforts in March which translated into boosting the sustainable recycling efforts associated with brands such as Primera, Happy Bath and Innisfree, while continuing to strengthen its broader corporate standards on the development of more sustainable products. Innovations have included the use of recycled packaging mediums such as paper and plant-based plastics. This past August, Innisfree unveiled an eco-friendly paper bottle for its Intensive Hydrating Serum which uses 51.8% less plastic than the original packaging. Housed in a paper casing, the bottle features an outer paper mold made from mixed scrap paper, which can be pulled away from the inner plastic container so that the paper and plastic can both be recycled separately.

In December, Amorepacific announced it had entered into a partnership with coveted Indie brand Milk Makeup. The move gave Amorepacific a minority stake in the company, enabling it to help support Milk Makeup’s planned entrance into the Korean market, following its expansion into the UK, Germany, Spain and Scandinavia last year.

2020 Highlights: In May the company announced a partnership with the Australian luxury skin care company Rational with the expectation of securing a local production base in Australia and strengthening its retail network, which Amorepacific hoped would provide a foundation for its operations in Oceania.

Looking Ahead: Like many companies, Amorepacific was hit hard by the global pandemic with roughly 60% of its China stores closed in February and over 95% of its stores closed in North American and Europe through March. Although online sales climbed 80% in Q1 2020, domestic sales fall over 22%. Q2 2020 was even worse: The company’s net profit declined 88.2% from a year earlier as another coronavirus outbreak cratered cosmetics sales at home and abroad. According to a regulatory filing, the company’s Q2 net income for April-June was 6.7 billion won (U.S. $5.6 million) which starkly contrasts with the same period last year when that amount was 57.1 billion won. Flagging in-person domestic sales were somewhat brightened by a 60% increase in online sales channels.

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