Lotte Shopping's Q1 Operating Profit Soars 70% on Surge in Foreign Tourist Spending

Lotte Shopping has announced a remarkable turnaround in its first-quarter financial results, posting a 70.6% surge in operating profit compared to the previous year. This significant improvement, totaling 252.9 billion won, is largely attributed to the stellar performance of its department store division, which saw a notable 8.2% increase in sales. The resurgence is particularly evident in its flagship stores, where sales climbed by an impressive 19% year-on-year.

A key driver behind this department store success is the dramatic rebound in sales to foreign tourists. These sales experienced a staggering 92% increase, contributing substantially to the overall revenue growth. The Myeongdong main branch, in particular, witnessed a remarkable 103% rise in foreign tourist sales, now accounting for 23% of its total revenue. This trend highlights the growing importance of international tourism in revitalizing South Korea's retail sector, a factor Lotte Shopping plans to capitalize on further in the second quarter.

While the department store division shines, other segments of Lotte Shopping also show signs of recovery and growth. The mart business, bolstered by strong performance in Vietnam, saw its operating profit increase by 30.9% domestically, thanks to cost-saving measures. Home shopping also reported a significant 118.6% jump in operating profit, driven by sales of high-margin products like health foods and beauty items. Although the e-commerce platform Lotte ON continues to face challenges, reporting its ninth consecutive quarter of losses, the reduction in its operating loss indicates progress in its restructuring efforts. Conversely, Lotte Hi-Mart experienced a decline in both sales and operating profit due to a sluggish domestic electronics market.