What: Hyundai Department Store reports 3.5% sales growth and 12.4% increase in operating profit for Q4 2024, driven by strong department store performance and subsidiary contributions.

Why it is important: This growth shows how Korean retailers are successfully navigating market challenges through a combination of traditional retail strength and strategic diversification.

Hyundai Department Store achieved consolidated sales of 1.1752 trillion won and operating profit of 107.9 billion won in Q4 2024, representing year-on-year increases of 3.5% and 12.4% respectively. The department store division recorded sales of 660.8 billion won, up 0.8%, despite a 5.1% decline in operating profit to 113.8 billion won, affected by late winter weather and increased costs. Subsidiary Zinus significantly contributed to performance, with sales rising 2.4% to 289 billion won and operating profit increasing 852.6% to 16.1 billion won. While duty-free operations showed 12.2% sales growth to 263 billion won, losses narrowed by 3.9 billion won. The company plans to enhance shareholder returns through increased dividends, raising the per-share amount to 1,400 won and introducing half-year dividends.

IADS Notes: Hyundai's performance reflects broader trends in Korean retail transformation. January 2025 data shows department store growth falling below 1% amid increasing market polarization, though May 2024 saw major retailers achieve a combined 3.8% sales growth despite challenges. Hyundai's strategy aligns with its November 2024 announcement of a comprehensive three-year value-up plan, contrasting with January 2025 reports of competitors Lotte and Shinsegae seeking new markets amid domestic consumption decline. The company's focus on core department store operations comes as February 2024 saw Korean retailers increasingly transform into entertainment destinations. These developments demonstrate how Hyundai is balancing traditional retail strengths with strategic diversification while maintaining profitability in a challenging market environment.

Hyundai Department Store reports 6.4% drop in operating profit to 284.2 billion won