SEOUL, April 1 (Korea Bizwire) — Lotte Duty Free said Friday its operating loss widened last year due to the prolonged COVID-19 lockdown in China and the dollar’s weakness.
The duty-free operator posted an operating loss of 139.5 billion won (US$106.8 million) for the entire year of 2022, up from 28.8 billion won in 2021, the company said in a regulatory filing.
Sales came to 5.03 trillion won, up 35.3 percent on-year.
The company attributed its continued losses to China’s longer-than-expected COVID-19 lockdown and a drop in the value of inventory assets due to the weakening of the dollar at the end of the year.
Lotte Duty Free said it will make efforts to reduce its reliance on Chinese resellers and attract more tourists from other countries to its duty-free stores.
It will also focus resources — previously allotted as rent expense to the Incheon International Airport — on its inner city stores and online sales channels, the company said.
The world’s second-largest travel retailer recently lost out in the first round of bidding for five duty-free spots at South Korea’s main gateway, after operating at the airport for the past 22 years.
Hotel Shilla, Shinsegae DF and Hyundai Department Store Duty Free were shortlisted as candidates.
Meanwhile, sales from its overseas branches, including in Australia, Vietnam and Singapore, swelled 340 percent on-year, backed by the global reopening, the company added.