Amorepacific Corporation

Source for all tables: S&P Global Market Intelligence via StockAnalysis.com (consolidated K-IFRS, FY2021–FY2025; TTM to 30 Jun 2026), cross-checked against company releases (FY2024 and FY2025 revenue and OP match exactly).

Income statement

Notes:

• S&P's FY2025 EPS deducts KRW 36.1bn of "preferred dividends and other adjustments" and computes EPS over about 69m shares (common plus preferred). Broker EPS bases differ; for example, Kiwoom shows FY2024 EPS of KRW 8,591.

• FY2025 net income incl. minorities of KRW 247.3bn matches Dealsite's report of KRW 247.3bn (-58.9% YoY).

Revenue CAGR (derived): FY2021–FY2025 was -3.3%, reflecting the China/duty-free reset. FY2023–FY2025 was +7.6%. The TTM to June 2026 of KRW 4,491.9bn is 5.6% above FY2025.

TTM (to 30 June 2026): revenue KRW 4,491.9bn; gross profit KRW 3,278.2bn (73.0%); operating income KRW 388.5bn (8.65%); EBITDA KRW 649.1bn (14.45%); net income attributable KRW 286.0bn.

Commentary — revenue. The FY2022–FY2023 contraction (-15.0% and -11.1%) reflected collapsing Chinese duty-free and daigou demand, de-stocking in China, and Innisfree/road-shop decline in the broader group. The FY2024 recovery (+5.7%) was driven by COSRX consolidation from May 2024 and Western growth. Organic Greater China revenue fell 27% in 2024 on channel restructuring (Toyo Economy, Feb 2025). FY2025 (+9.5%) was broad-based: domestic +5% (online, MBS, department stores, duty-free and cross-border) and overseas +15%, including Americas +20% and EMEA +42%. H1 2026 maintained growth at +11.5% (derived: KRW 2,311.7bn versus KRW 2,072.5bn).

Commentary — margins. Gross margin expanded about 470 bp from the FY2022 trough to FY2025. Drivers were mix (COSRX and derma), less discounting in China, the exit from low-margin channels and cost-structure improvement. The operating margin troughed at 2.9% in FY2023. It recovered to 7.9% in FY2025 despite the Q4 voluntary retirement charge of KRW 53.6bn; excluding that charge, it would have been about 9.2% (derived). Advertising intensity remains high at 13–15% of revenue, a deliberate investment in Western brand-building, Amazon and TikTok. This is the key swing factor for margin progression.

Commentary — below the line. FY2024 pre-tax income (KRW 620.8bn) was inflated by about KRW 376bn of "earnings from equity investments." This is consistent with a remeasurement gain on the previously held 38.4% COSRX stake upon obtaining control (S&P line item). It was also boosted by KRW 114.1bn of investment gains, partly offset by a KRW 96.2bn asset write-down. The FY2024 net income of KRW 593.2bn and ROE of 11.8% are therefore not representative of recurring earnings. FY2023 pre-tax income also benefited from KRW 188.4bn of investment disposal gains.

Balance sheet

As of 30 June 2026: total assets KRW 7,087.4bn; cash and investments KRW 1,136.6bn; total debt KRW 327.9bn; net cash KRW 808.7bn; equity KRW 5,631.7bn; goodwill KRW 792.0bn.

Commentary. The balance sheet is conservatively financed. The company has carried net cash in every year, and financial debt consists largely of short-term borrowings at overseas subsidiaries plus lease liabilities. The COSRX acquisition in 2024 (net cash outflow of KRW 494.0bn) temporarily cut net cash to KRW 314.5bn. It also added about KRW 1.43tn of goodwill and intangibles, which now make up about 25% of total assets. This creates impairment sensitivity to COSRX's performance, a risk that briefly crystallised in market sentiment during COSRX's 2024–2025 distribution reset. By FY2025, strong FCF had restored net cash to KRW 731.7bn. Inventory rose sharply in FY2024 with COSRX consolidation and has since stabilised.

Cash flow

FY2021 shows a small net cash inflow of KRW 44.9bn from acquisitions/disposals; it is shown as 0 here. The TTM to June 2026 shows OCF of KRW 503.8bn, capex of KRW 66.1bn, FCF of KRW 437.7bn and dividends of KRW 104.0bn.

Commentary. FY2022 FCF collapsed because of a KRW 345bn working-capital outflow, consistent with inventory and channel disruption in China and settlement of liabilities. FY2025 FCF of KRW 519bn (12.2% margin) was the strongest since FY2021. It was helped by higher profit, lower capex (KRW 64.6bn, about 1.5% of revenue) and neutral working capital. Shareholder distributions are modest: dividends plus buybacks were KRW 97.3bn, or 19% of FY2025 FCF. Treasury share purchases are mainly for employee stock compensation, consistent with the "자사주 상여금" disclosures of August 2025.

Ratios

Source: S&P/StockAnalysis for ROE, ROA, ROIC, liquidity, leverage and turnover. Analyst derivations for coverage and cycle metrics.

Commentary. Returns on capital remain the weakest part of the equity story. Excluding the FY2024 remeasurement gain, ROE has been 3–5%, below the cost of equity and below the 7–8% target set in the November 2024 Value-up plan. Low returns stem from (i) a large equity base, including about KRW 4.8tn of retained earnings, (ii) sub-scale operating margins, and (iii) a cash-rich, under-levered balance sheet. The cash conversion cycle lengthened by about 38 days from FY2021 to FY2024–25, mainly because of slower inventory turns. This reflects multi-brand, multi-country SKU proliferation and COSRX inventory consolidation. It is a working-capital efficiency lever for the next phase.

Management guidance

BY27 (July 2026–June 2027): revenue +10%, OPM of at least 11% (11–12% per Kyobo summary).

BY30: derma KRW 1tn; hair care KRW 1tn with at least 60% global share.

2035: group revenue of KRW 15tn; IOPE KRW 500bn.

2027 (Value-up): OPM of 12% and ROE of 7–8%.

Consensus / broker expectations

Bull case

1. Margin runway is real. Excluding the voluntary retirement charge, the BY26 OPM was about 9.8% while advertising stayed at about 13.6% of sales. Scale in the Americas (+57% in Q2 2026) and COSRX's estimated 23–25% OPM should lift the group toward 11–12% as Western businesses mature.

2. Brand-diversified growth. Growth no longer relies on Sulwhasoo/China or LANEIGE alone. AESTURA plus ILLIYOON exceeded KRW 400bn (+67%), COSRX is re-accelerating, and hair care (about KRW 490bn) has a credible path to KRW 1tn.

3. Balance sheet and re-rating optionality. Net cash of about KRW 0.8tn (about 10% of common market cap), a forward P/E of about 21x versus global peers, rising NPS ownership (10.49%) and a possible step-up in shareholder returns could close the discount.

Bear case

1. Guidance credibility. BY26 missed the 10% margin target on a reported basis, and the 2024 Value-up targets (12% OPM, ROE of 7–8% by 2027) look stretched against an FY2025 OPM of 7.9% and ROE of 4.6%.

2. Customer-acquisition inflation. Western growth is bought with heavy Amazon and TikTok promotion. SK Securities already expects a Q3 2026 profit miss on Prime Big Deal Days spend, and APR shows that rivals can out-execute at higher margins.

3. Structural drags persist. Greater China is still shrinking, inventory days are about 150, and about KRW 1.72tn of acquired intangibles concentrate risk in COSRX.

Key catalysts and monitorables (next 12 months)

• Q3 2026 results (expected late October / early November 2026): consensus OP is about KRW 117–118bn. Watch the overseas margin after Prime Day timing and the Greater China trajectory.

Q4 2026: the first quarter without the prior-year voluntary retirement charge creates a favourable comparison (Q4 2025 OP was KRW 52.5bn). Amazon October and November events also fall in this quarter.

Progress against BY27 guidance: half-year checkpoint with Q4 2026 results in February 2027.

IOPE Europe and AESTURA expansion: to nine more countries (H1 2027); Sulwhasoo Japan performance.

COSRX growth sustainability: Q3 2026E +31% (NH) and margin.

Shareholder-return actions: under the Value-up framework (capital-reserve dividends, cancellations); NPS ownership changes.

US tariff and trade developments; inbound tourism to Korea: (duty-free).

Analyst verdict

Amorepacific Corporation has completed the hardest part of its turnaround. Revenue has returned above KRW 4tn after three years below it, and operating profit has tripled from the FY2023 trough. The mix has shifted decisively toward the Americas, EMEA, Japan and derma brands, which now carry the growth that China once supplied. The Q2 2026 quarter (+17% revenue, +59% operating profit, overseas OP +99%) was the clearest evidence yet that the multi-brand, multi-channel model can deliver growth and operating leverage together.

The investment case still rests on margin conversion rather than revenue momentum. The company exceeded its BY26 revenue goal but missed its 10% margin target on a reported basis, and ROE remains around 5%, roughly half the 2027 Value-up target. Marketing intensity of 13–15% of sales is the cost of competing on Amazon and TikTok against nimble rivals such as APR, which grows faster at three times the margin. The new BY27 margin target of at least 11% is achievable only if Western businesses scale toward group-average margins and Greater China at least stabilises.

The stock trades at about 21x forward earnings, about 12.7x EV/EBITDA and about 1.6x book, with about KRW 0.8tn of net cash. That is undemanding against global beauty peers but not obviously cheap against Amorepacific's own return profile. Broker targets cluster at KRW 170,000–210,000. Our synthesis is that the risk-reward is constructive but execution-dependent. Upside requires consecutive quarters at 10%+ operating margins, sustained 25%+ growth in the Americas and EMEA, and a clearer capital-return framework. Downside comes from promotional-cost inflation and COSRX volatility. On the evidence available as of 15 October 2026, the trajectory favours continued earnings recovery, with Q3–Q4 2026 results the decisive test of the BY27 margin commitment.

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End of dossier. All figures are as reported or derived from cited sources as of 15 October 2026.