Emart posts standalone Q3 operating profit of 166 billion won; Starbucks records a 45.3 billion won loss

[Financial News]  Emart posted strong results in the third quarter of this year, with both standalone-basis sales and operating profit rising on the strength of growth in its core hypermarket business. However, consolidated operating profit fell sharply as Starbucks Korea posted an operating loss amid controversy over its “Tank Day” marketing.
According to the Financial Supervisory Service’s electronic disclosure system on the 11th, Emart’s standalone operating profit in the third quarter of this year rose 46.3% year on year to 166 billion won. Total sales for the same period increased 11.1% to 5.104 trillion won.  This was the first time quarterly total sales had exceeded 5 trillion won.
However, as Starbucks posted an operating loss amid controversy over its “Tank Day” marketing, Emart’s consolidated operating profit in the third quarter fell 69.6% year on year to 46.1 billion won. Net sales for the same period rose 1.2% to 7.4919 trillion won.
Emart’s improved results are seen as reflecting stronger competitiveness in its core hypermarket business. Analysts say that cost savings from integrated purchasing, large-scale discount events and an expanded range of private-label (PL) products helped attract customers.
Sales and visitor numbers at Goraeit Festa, a major discount event held in the third quarter, rose 29.2% and 14.7%, respectively, from a year earlier. Sales of the ultra-low-priced private label “5K Price” also at least doubled over the same period.
Store renovations also helped draw in more customers. After the Gyeongsan store was converted to Starfield Market, a space combining shopping and relaxation, its sales rose 18.4% and visitor numbers increased 8.4%. The Dongtan store likewise saw sales and visitor numbers rise 11.4% and 7.7%, respectively. Boosted by these gains, visitor numbers at Emart discount stores in the third quarter of this year increased 5.3% year on year.
The warehouse-style discount store chain Traders posted its highest-ever quarterly results. Total sales in the third quarter rose 16.6% year on year to 1.1668 trillion won, while operating profit increased 40.5% to 55.2 billion won. Sales of its private label “T Standard” and “T Cafe,” the in-store food and beverage section, rose 16.6% and 15.5%, respectively, supporting the results.
emart everyday, a corporate-run supermarket (SSM), also achieved both top-line growth and improved profitability. Third-quarter total sales rose 7.7% year on year to 399.5 billion won, while operating profit increased 11.1% to 11 billion won.
However, results among the major subsidiaries were mixed. SSG.COM’s bottom line improved by 15.8 billion won year on year, aided by greater efficiency in product and logistics operations. Emart24 also narrowed its operating loss by 4.9 billion won from a year earlier, bringing it down to 2.9 billion won through efforts to restructure its business around profitability. Josun Hotels & Resorts posted operating profit of 22.6 billion won, helped by rising demand for rooms as the number of foreign tourists increased. This represented a 2.7% increase from a year earlier.
SCK COMPANY, which operates Starbucks Korea, posted an operating loss of 45.3 billion won, affected by factors including the suspension of e-Frequency promotions. Emart plans to improve its results through efforts to restore its brand image, improve operational efficiency and strengthen the competitiveness of its products.
An Emart representative said, “The competitiveness of our core business, which we have steadily strengthened, has expanded our customer base and driven both top-line growth and improved profitability. We will continue to innovate in retail while expanding the benefits customers can experience, further solidifying our market leadership.”
[email protected] Jang Yu-ha Reporter