LG H&H (051900) Q2 2025 earnings summary

Executive summary

• 2Q 2025 sales declined 8.8% year-over-year to 1,605bn KRW, with operating profit down 65.4% to 55bn KRW and net profit down 64.0% to 39bn KRW.

• 1H 2025 sales fell 5.3% year-over-year to 3,303bn KRW, operating profit dropped 36.3% to 197bn KRW, and net profit decreased 35.5% to 142bn KRW.

• Beauty, HDB, and Refreshment segments contributed 39.7%, 33.8%, and 26.5% of sales, respectively.

• The company maintained a strong financial position with total assets of KRW 7,270.0 billion and equity of KRW 5,756.9 billion as of June 2025.

Financial highlights

• Gross margin for 2Q 2025 was 50% (806bn KRW gross profit on 1,605bn KRW sales), down from 53.5% a year ago.

• Operating margin for 2Q 2025 was 3.4%, down 5.6 percentage points year-over-year.

• Debt-to-equity ratio improved to 26.3% as of June 2025 from 30.2% at end-2024.

• Cash and cash equivalents at period end: KRW 1,141.0 billion.

• EPS: KRW 7,956 (down from KRW 11,281 in FY 2024).

Outlook and guidance

• Plans to expand beauty tech business with the acquisition of 'LG Pra.L' and launch of new device and skincare lines.

• Further expansion of product lineups and distribution channels for beauty tech expected in 2H 2025.

• Announced a mid-year dividend of KRW 16.8 billion and plans to cancel 315,738 treasury shares in August 2025.

• Dividend policy updated to target a payout ratio of 25–30% of recurring net income.

• Focus remains on strengthening premium/luxury brands, expanding overseas, and investing in R&D and ESG initiatives.