LG H&H (051900) Q2 2024 earnings summary

Executive summary

• Q2 2024 consolidated revenue was ₩1.76 trillion, down 2.7% year-over-year, with operating profit up 0.4% to ₩158.5 billion and net income up 11.2% to ₩107.2 billion.

• H1 2024 revenue was nearly flat at ₩3.49 trillion, with operating profit up 1.9% and net income up 14.3% year-over-year.

• Operates in Beauty (cosmetics), HDB (Home Care & Daily Beauty), and Refreshment (beverages) segments, with a strong portfolio of luxury and premium brands and a leading domestic market position.

• Maintains a diversified business model with significant overseas expansion, especially in China, North America, and Japan.

• Focuses on R&D, sustainability, and digital transformation, with ongoing investments in eco-friendly packaging and carbon neutrality.

Financial highlights

• 2024 H1 consolidated revenue: ₩3,488.4B, down from ₩6,804.8B in FY2023 and ₩7,185.8B in FY2022.

• 2024 H1 operating profit: ₩309.6B; net profit: ₩220.3B; EPS: ₩12,347.

• Segment revenue split (2024 H1): Beauty 43.0%, HDB 30.8%, Refreshment 26.2%.

• Q2 operating margin improved to 9.0% from 8.7% a year ago; H1 operating margin rose to 8.9% from 8.7% year-over-year.

• Cash and equivalents decreased to ₩501.6 billion as of June 2024, down from ₩910.3 billion at year-end 2023.

Outlook and guidance

• Continues to invest in production capacity, digital channels, and global expansion, especially in luxury beauty and premium daily care.

• Maintains a dividend policy targeting ~25% payout of recurring net income.

• Focuses on sustainability, aiming for 45% carbon reduction by 2030 and carbon neutrality by 2050.