[Alpha Biz=(Chicago) Reporter Kim Jisun] Lotte Shopping tentatively announced on the 10th that it recorded sales of 3.622 trillion won and operating profit of 51 billion won in the second quarter of 2023.

Sales and operating profit fell 7.2% and 30.8%, respectively, compared to the same period last year. However, net profit during the term rose 156.3% to 117 billion won in the second quarter due to a significant increase in non-operating profit and loss, including equity method profit and loss.

By business unit, sales in the second quarter of this year fell 0.9% year-on-year to 82.2 billion won. Operating profit fell 36.9% year-on-year to 66 billion won. Although sales rose slightly in the food and fashion product group, sales remained at a similar level year-on-year as sales of the home appliance group decreased due to a decrease in demand for home appliance replacement.

On the other hand, operating profit fell as sales and government expenses rose 28.4 billion won year-on-year due to inflation. Overseas department stores saw their sales increase, but their operating profit declined last year due to the reverse base effect of reducing rent at Indonesian stores.

Lotte Department Store expects sales and operating profit to improve as it renews its major stores in the Seoul metropolitan area, including Incheon and Suwon branches, in the second half of this year. Overseas, we will also focus our capabilities on 'Lotte Mall West Lake Hanoi', which is being piloted in Vietnam at the end of July.

Among the business units, home shopping saw its operating profit plunge the most. Lotte Home Shopping recorded sales of 231 billion won and operating profit of 2 billion won in the second quarter of this year. Sales fell 15.2% and operating profit fell 92.8% year-on-year. Home shopping also fell 9.4% on-year, largely due to a 40.4% drop in the e-commerce sector.

The e-commerce business division, or Lotteon, focused on improving its profit and loss structure, focusing on vertical commerce. As a result, sales in the second quarter of this year increased by 41.5% year-on-year to 36 billion won and operating loss by 57% year-on-year to 21 billion won. Although it has not posted a quarterly surplus yet, it has been improving its deficit for four consecutive quarters since the third quarter of last year.

Lotteon said that its beauty, luxury, fashion, and kids' vertical services, which have been in operation since last year, have stabilized with positive results. Vertical mall transactions rose 11.7% year-on-year in the second quarter of this year, especially in luxury (84.3%) and fashion (11.2%).

 

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