GS Retail's Operating Profit Up 5.7% Last Year... Weak Performance in Q4 (Comprehensive)

[Asia Economy Reporter Lim Chun-han] GS Retail announced on the 8th that its consolidated operating profit for last year was tentatively estimated at 252.6 billion KRW, a 5.7% increase from the previous year. Although sales decreased to 8.8623 trillion KRW, net profit rose by 7.6% to 154.5 billion KRW.

Operating profit for the fourth quarter of last year was 25.7 billion KRW, down 48.5% compared to the same period last year. Sales were 2.1609 trillion KRW, and net profit was 5.4 billion KRW, decreasing by 3.6% and 44.5%, respectively.

Looking at the fourth quarter performance by business segment, convenience store sales, the core business, increased by only 0.2% to 1.7272 trillion KRW. Operating profit fell 29.4% to 37.4 billion KRW. This was due to an 11% decrease in sales in school and academy districts caused by delayed school openings and continued remote work amid the resurgence of COVID-19, while office district sales growth remained at 2%.

Supermarket business sales decreased by 12.5% to 284.7 billion KRW. This was influenced by the closure of a total of 35 underperforming stores from the fourth quarter of 2019 through the fourth quarter of last year. Operating loss was 9.4 billion KRW, but it decreased by 16.1 billion KRW compared to the same period last year due to reduced advertising and promotional expenses.

The hotel business recorded an operating loss of 3.4 billion KRW, turning to a deficit. This was due to the impact of the COVID-19 resurgence, which lowered occupancy rates at the COEX Intercontinental Hotel, as well as poor business performance at the Grand Hotel and Nine Tree Hotel, which reopened after renovations.

GS Retail stated that it plans to pursue an 'Offline for Online' (O4O) strategy based on customer data through its merger with GS Home Shopping this year. Through this, it aims to expand product sales and create various synergies, thereby responding to the post-COVID era and establishing a business foundation capable of surviving competition with online platforms.

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