Seoul: Emart Inc., South Korea's leading discount retailer, announced that its fourth-quarter net loss widened compared to the previous year, primarily due to one-off costs. In the three months ending December 31, the company reported a deepened net loss of 596.3 billion won (approximately US$410 million), a significant increase from the 107.1 billion won loss in the same period the previous year, as stated in a regulatory filing.
According to Yonhap News Agency, a company spokesperson attributed the increased loss to a substantial provision of 213.2 billion won for ordinary wages, following a recent court ruling, and voluntary retirement programs. In December, the Supreme Court determined that regular periodic bonuses should be included in ordinary wages, leading many businesses to increase provisions for wages and severance pay.
Despite the net loss, Emart reported that its fourth-quarter operating loss narrowed to 77.1 billion won from 85.5 billion won a year earlier. However, sales experienced a decline of 1.4 percent, falling to 7.24 trillion won from 7.35 trillion won during the same period.
For the full year of 2024, Emart's net losses widened to 573.4 billion won from 187.5 billion won in the prior year. Nonetheless, the company transitioned to an operating profit of 47.1 billion won from an operating loss of 46.9 billion won in 2023. The spokesperson explained that investment gains from property development projects and shareholding gains from affiliates, including Starbucks Korea, contributed to the positive operating result. Starbucks Korea achieved an operating profit of 190.8 billion won on sales of 3.1 trillion won last year, with the number of its outlets surpassing 2,000 in Korea.
Emart, which is part of the Shinsegae Group and owns a 67.5 percent stake in Starbucks Korea, saw its annual sales decrease by 1.5 percent year-on-year to 29 trillion won in 2024. The company aims to bolster its operating profit to 1 trillion won by 2027 on projected annual sales of 34 trillion won, focusing on its core businesses. To enhance shareholder value, Emart plans to cancel half of its treasury shares, or 2 percent of its outstanding stocks, between 2025 and 2026. In addition to its discount store chain, Emart operates the big-box store Emart Traders and the Emart 24 convenience store chain.