LG Household and Health care (LG H&H) is a major fast-moving consumer goods company that owns businesses in beauty and personal care, household goods, and beverages.
Despite the uncertainties presented by the new COVID-19 variants, the company managed to set record-high sales and operating profit results, surpassing pre-pandemic levels.
“Uncertainties surrounding economic recovery remained at highly elevated levels throughout the year due to continued emergence of new COVID variants and an unstable business environment. However, sales, operating profit, and net profit set record highs, surpassing pre-COVID levels.”
Overall, its sales increased by 3.1% year on year (YoY) to KRW8.1tn (U$6.69bn) while operating profit increased 5.6% YoY to KRW1.3tn (U$1.07bn).
This is LG H&H’s 17th consecutive year of growth for both sales and operating profit figures. Additionally, it is the first time its sales exceeded KRW8tn (U$6.6bn) mark.
The company’s beauty business, which consists of two separate divisions, saw sales grow by 3.2% to KRW5.7tn ($U4.7bn) while operating profit grew 8.5% to KRW1tn (U$826m)
The company’s luxury beauty portfolio, which consists of brands such as History of Whoo and Su:m37, managed to sustain a strong showing.
Its performance was underpinned by the strong luxury beauty market in China, where the firm expanded into new channels such as Tmall and JD.
Additionally, sales were bolstered by the Singles’ Day Festival, one of the biggest shopping campaigns in the fourth quarter.
Additionally, Whoo actively promoted its high-end Cheongidan and Hwanyu ranges throughout the year to further strengthen its luxury position in the global market.
While sales for the luxury beauty division decreased slightly by 0.4%, operating profit increased 6.5% to KRW876bn (U$724m), making it the best performing division for LG H&H.
The company’s mass-market beauty and personal care brands like Dr. Groot, Physiogel and Himalayan Pink Salt drove the sales and profit growth for the portfolio.
Sales increased 9.9% YoY to KRW2.1tn (U$1.74bn) won and operating profit increased by 1.7% to KRW209bn (U$173m).
In terms of product development, the company highlighted that has been placing more weight on sustainability and environmental concerns.
This led to the launch of a refill station for Dr. Groot and Veilment as well as a line of low-waste personal care options for four of its brands: Dr. Groot, Elastine, Veilment, and Himalayan Pink Salt.
Plans for 2022
LG H&H has plans to focus on its beauty business in the new year, emphasising the importance of its luxury beauty division and brands like Whoo.
As part of its ambitions to advance its luxury beauty business, the firm has its sights set on strengthening its business in North America.
The firm said will work to push Whoo, which has already achieved great success in Asia, in the North American market.