The Seoul-based cosmetics maker posted a net profit of 22.49 billion won ($15.4 million) for the quarter ending December, reversing a loss of 46.23 billion won from the previous year. While revenue climbed 6.6%, operating profit fell 33% due to one-off expenses tied to an early retirement program. However, investors looked past the headline dip, focusing instead on the underlying strength of the company’s brand portfolio.

Restructuring and Brand Recovery

Analysts point to the recovery of Cosrx, a previously struggling skincare brand, as a primary driver of the stock's rally. Mirae Asset Securities analyst Bae Song-yi noted that if the estimated 53.6 billion won in one-off labor costs were excluded, the results would have comfortably exceeded market expectations. Consequently, Mirae Asset raised its target price for the stock to 180,000 won, maintaining a "buy" rating.

Beyond immediate earnings, the company’s efficiency measures are expected to yield long-term benefits. According to estimates from Samsung Securities, the recently implemented early retirement program could reduce annual labor expenses by approximately 20 billion won. This leaner cost structure, combined with the stock’s performance outpacing the benchmark Kospi, suggests a shift in market sentiment toward the South Korean beauty sector.