Lotte Shopping Co., the retail unit of South Korea's fifth-largest conglomerate, Lotte, said Friday it swung to the red in the first quarter from a year earlier as the company moves to withdraw from the Chinese market.
It suffered a net loss of 9.9 billion won (US$9.25 million) on a consolidated basis in the January-March period, compared with a net profit of 111.5 billion won posted a year earlier, the company said in a regulatory filing.
|Lotte conglomerate logo (Yonhap)|
Lotte Shopping operates the business group's key retail units, including its department store and hypermarket chains. The numbers reflect the performances of Lotte Shopping and its subsidiaries, including Lotte HiMart Co., which specializes in home appliances.
The company said its net dropped mainly due to costs incurred in the process of selling its discount store chain business in China, including the compensation for its employees.
Earlier in the day, Lotte Shopping said it has decided to sell one of its discount store units in the world's second-largest economy to a local retailer for 291.4 billion won.
The company unveiled its plan to pull out of China in September last year over heavy losses in the wake of a diplomatic row between Seoul and Beijing.
Operating income came to 164.9 billion won, up 6.6 percent on-year, while sales declined 2.2 percent to 4.35 trillion won over the cited period, it said.
Lotte Shopping was one of the companies most affected by Beijing's economic retaliation after it signed a land-swap deal with the Seoul government to host a U.S. missile defense system.
Shares of Lotte Shopping closed up 1.7 percent to 239,500 won on the Seoul bourse, outperforming the broader KOSPI's 0.55 percent gain. The quarterly earnings were released after the market closed. (Yonhap)
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