Hyundai Department Store Achieves Record-High Q1 Sales in Department Store Division...Zinus Posts Loss

Department Store Division Operating Profit Up 39.7%
Zinus Records KRW 30.1 Billion Operating Loss, Turns to Deficit
Consolidated Sales at KRW 950.1 Billion, Operating Profit at KRW 98.8 Billion

Hyundai Department Store achieved record-high sales in its department store division for the first quarter of this year, driven by strong sales in key product categories such as luxury goods, watches, jewelry, and fashion, as well as an increase in foreign customers. However, due to poor performance from its mattress affiliate, Zinus, consolidated operating profit decreased.

On May 6, Hyundai Department Store announced that its consolidated net sales for the first quarter of this year reached KRW 950.1 billion, with operating profit at KRW 98.8 billion. Both net sales and operating profit declined by 13.5% and 12.2%, respectively, compared to the same period last year.

By business segment, the growth of the department store division stood out. First quarter net sales in the department store segment reached KRW 632.5 billion, up 7.4% year-on-year, setting a new record high for any first quarter. Operating profit increased by 39.7% to KRW 135.8 billion. Notably, the rise in operating profit has accelerated, growing from KRW 18.3 billion in the third quarter of last year, to KRW 23.7 billion in the fourth quarter, and reaching KRW 38.5 billion in the first quarter of this year.

Exterior view of The Hyundai Seoul, Hyundai Department Store. Hyundai Department Store

Hyundai Department Store explained that increased sales of high-margin fashion items, such as winter outerwear, contributed to improved performance. The company analyzed that spending on overseas luxury brands has expanded to domestic fashion brands, leading to overall profitability improvements. The boost in foreign customer numbers also played a role. At The Hyundai Seoul, first quarter sales to foreign customers rose 121% year-on-year. The company noted that, in addition to shopping, K-culture-based experiential content in food and beauty categories attracted tourist demand.

A representative from Hyundai Department Store stated, "The department store division achieved record-high sales thanks to robust sales in key product categories and the expansion of foreign customers," adding, "We expect the growth trend to continue in the second quarter, led by high-margin fashion products."

The duty-free segment also continued its recovery. Hyundai Department Store Duty Free turned profitable in the first quarter, recording an operating profit of KRW 3.4 billion. This marks three consecutive quarters of profit since the third quarter of last year. Although net sales dropped by 27.2% year-on-year to KRW 213.7 billion due to the downsizing of downtown duty-free store locations, the company began operating the Incheon International Airport DF2 (cosmetics and liquor) store last month, which is expected to support stable profit in the second quarter as well.

In contrast, Zinus struggled due to global macroeconomic uncertainties and a slowdown in mattress market demand from U.S. client companies. First quarter net sales fell 44.2% year-on-year to KRW 139.6 billion, and the company turned to an operating loss of KRW 30.1 billion.

Meanwhile, on April 28, Hyundai Department Store completed the cancellation of 4.7% of its treasury shares previously held. From February to April, the company also acquired new treasury shares amounting to 1.1% (approximately KRW 21.9 billion), which are also scheduled to be canceled within this year.

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