Shinsegae's Q2 earnings hit records on recovered store sales from reopening

[Source: Shinsegae Department Store]

South Korean retail giant Shinsegae Inc. delivered the best-ever quarterly earnings in the second quarter thanks to a sharp recovery in offline department store sales from eased Covid restrictions since April and its revamped online shopping platform catering well to younger generations’ demands.

Its consolidated operating income for the second quarter ended June 30, 2022 jumped 14.5 percent on quarter and 94.7 percent on year to a record high of 187.4 billion won ($143.9 million), the company disclosed in a regulatory filing on Wednesday. The result was above the market consensus of 134.0 billion won.

Sales came to 1.88 trillion won, also a record high after gaining 6.3 percent from the previous quarter and 34.5 percent from a year ago.

Kospi-listed Shinsegae shares rose 2.50 percent to close at 225,500 won on Thursday.

Its department store division delivered 121.1 billion won in operating income over sales of 623.5 billion won, which were up 80.6 percent and 25.5 percent, respectively, versus a year ago.

Sales growth was seen across the board as demand for clothing revived with easing in Covid-19 social restrictions since April, said the company. Sales of women’s fashion rose 34.2 percent, men’s fashion 34.7 percent, and outdoor fashion 43.6 percent. Luxury sales expanded 22.2 percent.

The retailer had renovated one of its department stores to add a younger generation-targeted street fashion floor in preparation for the revived demand for offline shopping following the economy reopening,

Sales from its online stores surged 12.2 percent on year amid the retail giant’s aggressive digital transformation.

Shinsegae had all of its first 10,000 non-fungible tokens sold out in just 1 second after its market release in June. The online Shinsegae Department Store saw the number of new customers doubled and daily visitors jump 20 percent since it reopened at the retailer’s main e-commerce platform SSG.com after its revamp. The department store’s mobile app obtained 6.2 million users, up 137 percent from last year.

Equity gains from its units also improved.

Shinsegae International, operating in-house and imported fashion brands, generated 38.7 billion won in operating income, up 46.0 percent on year with revenue expanded 12.7 percent to 383.9 billion won.

Shinsegae DF, the duty-free outlet operator, recorded 813.2 billion won in revenue, up 45.1 percent on year.

Shinsegae Central City reported a 22.2 percent yearly growth in revenue on higher rental income from tenants at its hotel and department store.

[ⓒ Maeil Business Newspaper & mk.co.kr, All rights reserved]