Cosmecca Korea Reports Operating Profit of 1.9 Billion KRW, Up 6527% Year-on-Year

[Asia Economy Reporter Yujin Cho] Cosmecca Korea, a cosmetics research, development, and manufacturing (ODM) specialist company, announced on the 16th that its consolidated net profit for the third quarter of this year grew by 6526.9% year-on-year to 1.9 billion KRW. During the same period, sales decreased by 1.1% to 77.54 billion KRW.

Despite the impact of the novel coronavirus disease (hereinafter COVID-19), increased sales from the U.S. subsidiary drove overall performance growth. The Korean subsidiary’s sales amounted to 43.62 billion KRW, maintaining the previous year’s level despite the prolonged COVID-19 situation. Although orders from road shop clients declined, export sales grew significantly, resulting in favorable performance.

By product, steady sellers such as mask packs led sales. Compared to the same period last year, orders for sun spray and sun essence increased, boosting sales of UV protection products, and demand for home care products due to COVID-19 also increased skincare product sales.

The U.S. subsidiary, Englewood Lab, recorded sales of 36 billion KRW, up 20.5% year-on-year. Sales increased evenly from existing major clients and new online customers. Skincare products had the highest sales, and the prolonged use of masks led to a meaningful increase in orders for over-the-counter (OTC) skin-soothing cosmetics.

The Korean subsidiary located in Korea, Englewood Lab Korea, showed a remarkable sales growth of 27.1% due to increased sales from overseas online customers.

The Chinese subsidiary’s sales amounted to 5.2 billion KRW, down 22.7% year-on-year. Due to the impact of COVID-19, orders from major clients decreased, and sales from new clients were sluggish. However, orders increased in preparation for the Guanggun Festival special event held in November, and fourth-quarter sales are expected to rise.

The company stated, “The U.S. subsidiary, which accounts for more than 40% of consolidated sales, has overcome COVID-19 and continues stable growth centered on global major clients, driving consolidated performance. The operating profit margin of the U.S. subsidiary reached 9% due to operating leverage effects, demonstrating excellent profitability.”

Additionally, the Korean subsidiary plans to strengthen its sales capabilities by adopting non-face-to-face sales methods using webinars and videos, while the Chinese subsidiary will enhance customized responses for online customers such as live commerce, aligning with the changing distribution and business environment.

This content was produced with the assistance of AI translation services.