S. Korean cosmetics firm Skinfood files for court receivership

SEOUL, Oct. 8 (Yonhap) -- South Korean cosmetics company Skinfood said Monday it has filed for a court-led restructuring scheme due to mounting losses.

Launched in 2004, the company enjoyed popularity from the late 2000s and had grown to post annual sales of 200 billion won (US$176 million) with operating profits hitting some 15 billion won by 2012.

Skinfood, however, was hit hard by a Middle East Respiratory Syndrome (MERS) outbreak in 2015, followed by the a diplomatic row between Seoul and Beijing last year which led to a sharp drop in the number of tourists coming to South Korea.

"We are having temporary difficulty in securing liquidity due to excessive debt," a company official said. "We sought the court restructuring as we thought settling the debt and promptly normalizing management will benefit everyone, including the creditors."

The cosmetic brand is currently present in 19 foreign markets, including the United States, China and Japan. Skinfood said it is also considering selling some of its overseas business rights to improve its financial structure.

The company said it plans to expand its online channels to better meet demand from abroad in the long-term.

Skinfood's sales came to 126.9 billion won in 2017, down 25 percent from the previous year, with an operating loss of 98 billion won, according to its regulatory filing.

scaaet@yna.co.kr
(END)