[Click eStock] "Lotte Shopping Continues Poor Performance Despite Peak Season"

4Q Operating Profit Expected at 163.5 Billion KRW... 10% Decrease YoY

[Asia Economy Reporter Minwoo Lee] Lotte Shopping is expected to record sluggish performance even in the peak season of the fourth quarter. Although the department store division's operating profit is expected to recover slightly, the profitability of other key business divisions such as discount stores, Hi-Mart, and e-commerce is likely to remain weak.

On the 21st, DB Financial Investment lowered Lotte Shopping's target stock price by 27.6% to 110,000 KRW due to this background. The closing price the previous day was 88,500 KRW. The investment opinion 'Buy' was maintained.

The operating profit decline trend is expected to continue in the fourth quarter of this year as well. The forecasted performance is sales of 3.8568 trillion KRW and operating profit of 163.5 billion KRW. Sales are expected to increase by 0.2% compared to the same period last year, but operating profit is expected to decrease by 10.2%.

Jaeheon Cha, a researcher at DB Financial Investment, explained, "The department store division, which recorded a loss due to one-time costs such as 60 billion KRW in voluntary retirement expenses in the third quarter, is expected to recover in the fourth quarter peak season, but the year-on-year decline trend will continue. The profitability of other key business divisions such as discount stores, Hi-Mart, and e-commerce is also estimated to remain weak in the fourth quarter following the third quarter."

He emphasized the need to pay attention to the new moves of the management in this situation. Researcher Cha said, "Lotte Shopping is completing offline restructuring and unifying the online businesses of affiliates into the e-commerce division while promoting investments and partnerships to strengthen competitiveness. Attention is needed to the direction of performance changes next year that will appear along with the new management changes," he predicted.

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