LG Household & Health Care

LG Household & Health Care is a major South Korean consumer goods company that manages cosmetics, household goods, and beverages business. It is also the South Korean bottler of the Coca-Cola system.

LG Household & Health Care Ltd.
Native name
주식회사 LG생활건강
Jusikhoesa LG (El-Ji) Saenghwalgeongang
Public
Traded asKRX: 051900
IndustryConsumer goods
PredecessorLG Chem
FoundedApril 2001 (2001-04)
HeadquartersSeoul, South Korea
Area served
Worldwide
Key people
Suk Y. Cha (Vice Chairman and CEO)
ProductsCosmetics, Household Goods, Beverages
RevenueKRW 4,677 billion (2014)[1]
KRW 511 billion (2014)[1]
KRW 355 billion (2014)[1]
Total assetsKRW 3,828 billion (2014)[1]
Total equityKRW 1,709 billion (2014)[1]
Number of employees
9,566 (2014)[1]
ParentLG Corporation
SubsidiariesThe Face Shop
Websitelgcare.com/global

Summary

History

Founded in 1947, Koo In-Hwoi (Founder of LG Corp) established Lucky Chemical Industrial Corp, and launched "Lucky Cream," the very first cosmetics product in Korea. In 1954, the company also launched Korea's first toothpaste brand, ‘Lucky Toothpaste’. In February 1995, the company changed its name to LG Chemical Ltd. In April 2001, LG Household & Health Care spun off from LG Chemical, and was listed on the Korean Stock Exchange.[2] Since current CEO & Vice Chairman, Suk Y. Cha joined the company in 2005, the business made a successful turnaround, and the company's growth was further driven by strategic M&As.[3] Currently, LG Household & Health Care is expanding its cosmetics and personal care business into global market.[4]

M&A

When LG Household & Health Care was established, there were only two business divisions of cosmetics and household goods. From the acquisition of Coca-Cola Beverage(former Coca-Cola Korea Bottling Co., Ltd) in 2007, the company completed its current business structure of cosmetics, household goods, and beverages. Currently, LG Household & Health Care is an exclusive manufacturer and distributor of Coca-Cola brand products in Korea.[5] In 2009, the company acquired Diamond Water Co., Ltd to strengthen its drinking water business, and in 2011, the company acquired Haitai Beverage Co., Ltd, the third largest beverages company in Korea at the time.[6]

Since 2005, cosmetics business made a successful turnaround through new high-end brand launches including ‘The History of Whoo’, ‘SU:M37’, and ‘belif’. In 2010, the company acquired low-end cosmetics brandshop, ‘TheFaceShop’, and a complete cosmetics product portfolio consisting of high-end, mid-end, to low-end was achieved.[7] In 2012, LG Household & Health Care acquired cosmetics brand, ‘Violet Dream’ (former VOV) to strengthen its color cosmetics business.[8] In 2014, the company acquired local cosmeceutical firm, CNP Cosmetics Co., Ltd, in order to expand into newly growing cosmeceutical category.[9]

Business Division

Cosmetics

LG Household & Health Care is the second largest cosmetics company in South Korea, and it has continued to narrow the gap with its competitor.[10] Its major high-end cosmetics brands include ‘The History of Whoo’, ‘O Hui’, ‘SU:M37’, and ‘belif’.[11] The high-end cosmetics business is growing fast with ‘The History of Whoo’ recording the highest sales among all other brands in major duty-free stores in Korea.[12] The major brands in mid-to-low end cosmetics include ‘ISA KNOX’, ‘Sooryehan’, ‘BEYOND’, and ‘THEFACESHOP’, the number one brandshop in Korea.[13]

Household Goods

LG Household & Health Care has maintained a dominant number one position in Korean household goods industry, and still continues to increase its market share through product differentiation, and category expansion.[12] The major business units are personal care and home care. Personal care includes oral care, hair care, and body care, while home care includes dishwashing detergent, laundry detergent, and fabric softener. The major brands are ‘Perioe’·’Bamboo Salt’(oral care), ‘Elastine’·’Reen’(hair care), ‘ON: THE BODY’(body care), ‘TECH’(laundry detergent), ‘Jayeonpong’(dishwashing detergent), and ‘Saffron’(fabric softner).[14]

Beverages

Beverages business division was established through the M&A of Coca-Cola Beverage(former Coca-Cola Korea Bottling Co., Ltd) in 2007, and is currently the second largest beverage company in Korea.[15] The major brands are ‘Coca-Cola’, ‘Fanta’, ‘Sprite’, ‘Minute Maid’, ‘Sunkist’, ‘Georgia’, and ‘POWERADE’.[16]

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References
  1. "LG Household & Health Care 2014 Auditor's report". LG Household & Health Care. Retrieved November 18, 2014.
  2. "LG Household & Health Care: Leading the Way in Cosmetics". Archived from the original on November 19, 2015. Retrieved November 18, 2015.
  3. Cha’s success reveals secret of CEO longevity
  4. LG’s cosmetics unit bets big on Chinese market
  5. Acquisition of CCKBC Finalized
  6. LG HH Announces Takeover of Haitai Beverage
  7. LG H&H Takes over Korea's No. 3 Cosmetics Brand
  8. LG H&H Concludes an Agreement to Acquire VOV
  9. LG Household to acquire local cosmeceuticals maker CNP Cosmetics
  10. Cosmetics vs. creative economy
  11. LG Household & Health Care official site
  12. LG H&H reports net sales of 1.3 trillion won, and operating profit of 178 billion won for 1Q 2015
  13. Missha announces domestic downsizing, global expansion
  14. LG Household & Health Care official site
  15. LG Household to Buy Coca-Cola Amatil's Korean Unit (Update3)
  16. LG Household & Health Care official site
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