Foreign Shoppers Return and Luxury Sales Lift Department Stores Despite High Inflation
Creatrip Team
19 days ago
South Korea’s major department stores are set for strong second-quarter results despite high inflation. Sales of high-margin items like luxury brands and premium fashion have risen, and returning foreign tourists have boosted spending. Shinsegae and Lotte are forecast to show double-digit profit growth year-on-year, helped by cost savings (e.g., duty-free exit at Incheon Airport Terminal 2) and higher daily duty-free shop sales in city locations. Lotte also expects supermarket improvements and possible customer inflow from some closed large supermarkets. Hyundai Department Store’s profit growth is forecast to be modestly down for the quarter but supported by robust apparel sales and lower depreciation at key stores. Duty-free operations at Incheon’s DF2 zone are beginning to expand without heavy rent burdens, supporting profitability. Overall, steady tourist inflows and continued luxury and premium fashion demand should keep department store earnings resilient into the second half.
