■ Highest year-on-year growth in 22 consecutive quarters

■ Sales up 28.6% and net profit during the term up 54.8%

LG Household & Health Care (LG H&H) Ltd. (CEO: Suk Cha) announced its second quarter business results. It recorded its best quarterly results for 22 consecutive quarters since the first quarter of 2005, as sales amounted to KRW 705.8 billion and operating profit KRW 85.5 billion, a 28.6% and a 47.5% year-on-year increase respectively. Operating profit to sales ratio rose to 12.1%, a 1.5% point increase, and the net profit during the term grew by 54.8%, recording KRW 58.6 billion despite increased interest rates due to the take-over of The Face Shop.

▲ In household products, sales amounted to KRW 238.9 billion and operating profit KRW 19.8 billion, a 12.6% and a 16.5% year-on-year increase respectively. Business growth has accelerated as the new sanitary pad line and Beyond products have led the strong growth of the entire sector and existing products have gained positive responses through quality upgrades.

Having shown a 30% growth in sales and expanded market share (from 15% to 17.2%) supported by the strong product power, sanitary pad brand Body Fit and total beauty brand Beyond grew by 59%, having led the growth of the entire company.

▲ In cosmetics products, sales rapidly rose to KRW 264.9 billion and operating profit KRW 42.7 billion, a 55.1% and a 99.5% increase respectively, and operating profit to sales ratio also rose to 16.2%, a 3.7% point increase, as the take-over of the mass cosmetics brand The Face Shop has shown positive effects along with the sustained growth of the existing prestige and masstige sectors.

After the takeover, the growth of The Face Shop has accelerated, recording KRW 74.3 billion of sales and KRW 13.1 billion of operating profit, a 12.6% and a 25.7% increase respectively, as the products developed by adopting LG H&H’s technologies have shown strong sales. In addition, while establishing its No.1 position in the domestic mass cosmetics market by launching 69 new retail stores in the second quarter only, making the number of total stores exceed 800, it is now gearing up for overseas expansions in China, the United States and East Asian countries.

▲ In the beverage sector, sales amounted to KRW 191 billion and operating profit KRW 22.9 billion, a 15% and a 17% increase respectively, as new noncarbonated beverage brands have shown strong sales along with the steady growth of the existing brands.

In the soda sector, the main brand Coca-Cola has led the sector’s solid growth of 6.5%, while in noncarbonated beverage sector, Powerade and Minute Maid and new brands including the newly-launched Glaceau Vitamin Water have shown strong sales, leading the growth of 38% in the noncarbonated beverages sector, and enhanced the entire brand portfolio by occupying 33% share of the business.