Lotte Duty Free ponders exit from loss-making foreign locations as new CEO is appointed : Moodie Davitt Report

SOUTH KOREA. Lotte Group yesterday announced sweeping structural changes as it battles severe headwinds across multiple subsidiaries, including Lotte Duty Free.

The changes spell likely store closures and possible contract exits for the Korean travel retail giant and a new CEO.

According to respected business title The Chosun Daily, the group has replaced the CEOs of 18 out of its 58 subsidiaries in its annual “reshuffle”.

One of those is Lotte Duty Free CEO Kim Ju Nam. He has been superceded by Kim Dong-ha, previously head of the corporate culture team at Lotte Holdings’ HR Innovation Office.

The Moodie Davitt Report has sought verification and further details relating to the changes, reported widely across the Korean press today, following a Lotte Group investor relations meeting in Seoul yesterday (28 November).

Click on the image to read *BusinessKorea’s* report, which quotes a Hotel Lotte representative saying, “While the hotel and world business divisions are showing strong performance, the recovery in the duty-free business remains sluggish. Our goal is to achieve stable profits by optimising store operations, reducing fixed costs, and restructuring sales strategies.”

As reported, the country’s big four duty-free retailers all posted heavy Q3 losses as they continue to struggle in the face of soft spending by Chinese visitors, reduced daigou business and punitive airport rents at home and/or abroad. Lotte Duty Free figures exclude the Busan operation, as Lotte Hotel Busan is not a subsidiary of Hotel Lotte. Source: DART (Data Analysis, Retrieval, and Transfer), the Republic’s repository of corporate filings. Click on chart to expand.

**Click on the image to read *The Chosun Daily* report**

The report said: “The reshuffle comes as Lotte Group’s key affiliates grapple with poor performance. Lotte Holdings, Lotte Chemical and Lotte Duty Free recently entered emergency management systems after earnings declined. Analysts interpret the latest shakeup as a full-scale restructuring effort.”

In a separate report the title described the reshuffle as the steepest leadership contraction since the pandemic-era restructuring in 2021.

**Lotte Duty Free CEO Kim Ju Nam is moving on as part of the structural changes**

Fellow Korean business title The Korean Bizwire reported: “Lotte’s duty-free business is focusing on streamlining operations by potentially withdrawing from unprofitable overseas locations in countries like Japan, Vietnam and Australia [likely downtown -Ed].”

More to follow. ✈

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