LG Household & Health Care (LG H&H) reported that its third-quarter sales reached 1.58 trillion won, with operating profit of 46.2 billion won. Both figures declined year-on-year — sales fell 7.8% and operating profit plunged 56.5% — as continued weakness in the beauty division weighed heavily on overall performance.
In the beauty business, sales dropped 26.5% to 471 billion won, and the segment recorded an operating loss of 58.8 billion won. The company attributed the slump to ongoing channel restructuring, including adjustments to its duty-free distribution network and reduced volumes for key brands.
The decline was largely attributed to restructuring efforts across traditional channels, particularly the duty-free (DFS) channel, which saw an 8% decline due to large-scale volume controls for reorganization. While domestic “nurturing channels” achieved double-digit growth, led by brands such as VDL and CNP, overall performance was dragged down by weaker luxury brand sales and reduced volumes for core lines.
Luxury brands accounted for 68% of beauty sales, compared with 32% from premium brands. Among key labels, The Whoo contributed 38% of beauty revenue, followed by The Face Shop at 12%, belif and CNP at 5% each.
The Home Care & Daily Beauty (HDB) segment remained a bright spot, recording sales of 596 billion won, up 4.1% year-on-year, and operating profit of 42 billion won, up 6.8%. The operating margin improved slightly to 7.1%.
Growth was driven by strong overseas demand for premium brands, particularly Euthymol and Dr. Groot. Euthymol performed well both domestically and internationally, while Dr. Groot leveraged its online success to expand offline distribution in North America. New product collaborations — such as Euthymol x Hunter Boots — and innovation in anti-aging science with Physiogel’s Collagen Renew line also strengthened market competitiveness.
Within the HDB segment, daily beauty products accounted for 67% of sales and home care for 33%. Key brands included Dr. Groot and ON:THE BODY (5% each), Perioe (4%), and Physiogel (4%).
Overseas sales climbed 6.6% to 493 billion won, supported by strong growth in North America and Japan, which rose 21.1% and 6.8%, respectively. However, sales in China declined 4.7%, reflecting persistent market headwinds.
An LG H&H representative commented that the ongoing restructuring of its beauty business is “an essential process for a new leap forward,” emphasizing that the company, under new leadership, aims to strengthen competitiveness and restore mid- to long-term performance.
On the same day, LG H&H held an extraordinary shareholders’ meeting and board meeting to appoint Lee Seon-ju — formerly of L’Oréal — as the company’s new CEO. Lee, who has over three decades of experience in the domestic and international cosmetics industry, is credited with driving growth for major brands such as Kiehl’s, Yves Saint Laurent, and MEDIHEAL.
