Able C&C's nine-month operating profit hits W26.3b, 1.5 times last year's full-year figure

Able C&C, the company behind cosmetics brands Missha and A'pieu, is posting steady growth driven by overseas market expansion and a profitability-focused management strategy.

The company's cumulative operating profit for the first three quarters reached 26.3 billion won ($19.7 million) on a consolidated basis, about 1.5 times its full-year operating profit for last year, Able C&C said Friday. Third-quarter sales came in at 57.9 billion won, with operating profit of 6.5 billion won — a 3.0 percent increase in sales from the same period a year earlier. The operating profit margin held at 11.2 percent, maintaining a double-digit rate for three consecutive quarters.

Excluding sales from domestic directly operated stores, which the company fully exited in August, the underlying sales growth rate rises to 20 percent year on year. The results reflect the company's strategy of restructuring its business around core domestic and overseas retail channels.

Overseas operations drove the overall performance. Third-quarter overseas sales rose 24.2 percent year on year, with the cumulative overseas sales share reaching 73 percent. Sales expanded across major markets including the United States, which grew 10 percent, as well as Europe and Japan, while growth continued in the Middle East and other parts of Asia.

Europe stood out as the fastest-growing region. Third-quarter European sales rose 49 percent year on year, extending a streak of 40-percent-plus growth following gains of 43 percent in the first quarter and 48 percent in the second. Cumulative European sales for the first three quarters rose 47 percent. The company posted broad-based gains across Western and Eastern Europe, including the United Kingdom, Germany, Turkey, the Czech Republic and Russia.

Japan also saw sales growth and margin improvement at the same time. Third-quarter sales in Japan climbed 28 percent year on year, or 33 percent in local currency terms. The M Cushion product line, which accounts for 63 percent of total Japan sales, grew about 30 percent in local currency, leading the market's expansion. The Japan business maintained an operating profit and an operating margin in the 6 percent range.

Emerging markets also continued to gain momentum. Sales in the Middle East jumped 87 percent year on year, while sales in other Asian markets including Hong Kong and Mongolia rose 46.4 percent.

In the domestic market, the company pursued a strategy of selective focus on high-growth retail channels. Sales through major online platforms including Naver and 11st rose 32.3 percent year on year. Sales through the Daiso channel surged 92 percent, setting a record for the highest quarterly sales in the channel's history.

Able C&C said it plans to sustain growth by concentrating on key global markets — expanding both online and offline channels in the United States and Europe, strengthening profitability at overseas subsidiaries including Japan, and identifying new growth opportunities in emerging markets such as the Middle East.

"This quarter's results demonstrate the solid fundamentals we have built as a global beauty company, underpinned by strong growth in major overseas markets and stable profitability," Chief Executive Shin Yu-jeong said. "We will continue pursuing sustainable growth through the remainder of the second half by expanding our global distribution and strengthening brand competitiveness."