Amorepacific Shares Slump After Downbeat Fourth Quarter
By Kwanwoo Jun
Amorepacific Corp.'s shares slumped Wednesday after downbeat fourth-quarter results, as sluggish cosmetics sales continued to weigh on its earnings.
Shares of the South Korean beauty-product company fell as much as 9.4% to 123,000 won ($92.54), on track for their steepest daily drop in more than a year.
The stock underperformed the Kospi's 0.2% fall in early trade, after Amorepacific posted a 64% on year plunge in its operating profit for the quarter ended December. For the full year, operating profit dropped 50%.
Revenue also declined 15% in the December quarter, compared with the same period a year earlier, and 11% for 2023, according to the company. Weaker cosmetics sales in Asia and duty-free shops at home were largely blamed for the weak results.
Falling cosmetics sales, especially in China, and increased marketing costs could continue to weaken Amorepacific's earnings in 2024, DB Financial Investment analyst Jehnah Huh said in a research note.
Huh expects the company's operations in China to keep posting losses in the first half of 2024.
The stock faces near-term losses due to weak earnings results and a likely prolonged business slowdown in China, she said.
Write to Kwanwoo Jun at kwanwoo.jun@wsj.com
(END) Dow Jones Newswires
January 30, 2024 22:26 ET (03:26 GMT)
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