Lotte Himart's second-quarter earnings [Lotte Himart]
Lotte Himart's second-quarter earnings [Lotte Himart]

Lotte Himart returned to positive sales growth in the second quarter, raising expectations for a broader earnings turnaround in the second half of the year.

According to a regulatory filing Tuesday, Lotte Himart posted total sales of 733.9 billion won ($513 million) and net sales of 591.1 billion won in the second quarter. Total sales rose 0.7 percent from a year earlier, reversing a 4.3 percent decline in the first quarter. Net sales edged down 0.5 percent on-year, but grew 0.6 percent when one-time factors such as VAT refunds were excluded.

The improvement was even more pronounced on a monthly basis. Year-on-year total sales growth moved from minus 6.2 percent in April to minus 0.8 percent in May and plus 8.3 percent in June. Monthly operating profit also swung from a loss of 4.1 billion won in April to a profit of 2.4 billion won in May and 2.5 billion won in June.

For the full second quarter, operating profit came in at 900 million won, down 9.6 billion won from 10.5 billion won a year earlier. Stripping out the base effect from VAT refund income, however, the decline narrowed to 2.9 billion won — an improvement from the first quarter's shortfall of 6.4 billion won.

Lotte Himart attributed the sales recovery largely to strong growth in its Ansim Care service, which covers home appliance repair, cleaning and related offerings. Ansim Care sales have grown at an average annual rate of 56 percent over the past three years, reaching 37.3 billion won in the first half of this year — up 44 percent from the same period a year ago. The share of customers who purchased a service alongside an appliance also rose from 15 percent in 2023 to 52.5 percent in the first half of this year.

Sales of IT and mobile products, including smartphones and earphones, also continued to climb. The category grew 15.3 percent in the first quarter and 13.7 percent in the second, outpacing the industry average. Lotte Himart credited the gains to an expanded customer base built through new budget mobile plan offerings and a used-phone buyback program.

Lotte Himart plans to accelerate sales growth further in the second half. The company intends to strengthen its IT and mobile category — which sees shorter purchase cycles and higher buying frequency — and use it to drive cross-selling into higher-margin categories such as large appliances and kitchen and lifestyle electronics. It also plans to focus on boosting productivity through an aggressive push on AI transformation.

Lotte Himart's headquarters building [Lotte Himart]
Lotte Himart's headquarters building [Lotte Himart]

spa@heraldcorp.com