Lotte Shopping Co., an affiliate of retail giant Lotte Group, said Wednesday it shifted to a net loss in the second quarter due to liquidation losses involving its businesses in China.
Lotte Shopping swung to a net loss of 79.68 billion won (US$58 million) in the three months to June from a net profit of 116.55 billion won in the year-ago period, the company said in a statement.
“The company suffered more than 70 billion won in business liquidation losses, which were factored into the quarterly bottom line,” a company spokesperson said over the phone.
Korean retailers and other businesses have been struggling with declining sales due to the lingering impact of a diplomatic dispute over the deployment in South Korea of a U.S. anti-missile system called THAAD in 2017.
Beijing opposed the THAAD system, arguing it could be used against the country, though Seoul said it is purely aimed at deterring missile threats from North Korea.
Operating profit rose 8.9 percent to 56.06 billion won in the June quarter fr
om 51.49 billion won a year ago. Sales fell 5.4 percent to 3.43 trillion won from 3.62 trillion won.
From January to June, the company also shifted to a net loss of 6.8 billion won from a net profit of 174.33 billion won a year earlier.
Lotte Shopping is the operator of the country’s biggest department store outlets and the third-biggest discount store chain.
Source: Yonhap News Agency