KOSDAQCosmetics241710

Cosmecca Korea

₩110,400▼ 4.33%2026-10-02 close

Market Cap

₩1.2T

Turnover

₩19.4B

Volume

180,000 shares

Shares out.

10.7M

PER

22.5×

PBR

5.2×

EPS

₩5,977

Dividend Yield

0.00%

PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩0 per share · Prices as of the 2026-10-02 close

Report overview

Derma Skincare Growth Weighed Against Capex Load

Cosmecca Korea set a record quarterly top line riding a K-beauty export cycle that has widened into the US and Europe, while simultaneously absorbing the cash and fixed-cost burden of the Ochang plant purchase and a larger stake in its US affiliate.

1
Second-quarter 2026 revenue reached 226.1 billion won with operating profit of 32.1 billion won, a record quarter, lifting the operating margin into the 14 percent range (confirmed financials).
2
Consolidated revenue rose from 399.4 billion won in 2022 to 640.9 billion won in 2025 and operating profit from 10.4 billion to 83.5 billion won, taking the operating margin from 2.6 percent to 13.0 percent.
3
The growth engine is derma skincare at the Korean entity. In the second quarter of 2026 the Korean unit posted revenue of 178.8 billion won and operating profit of 24.5 billion won, with the skincare category up 94.8 percent year on year.
4
A March 2026 tender offer raised the stake in US subsidiary Englewood Lab from 50 percent to 66.67 percent, and in June the company acquired land and buildings of a plant in Ochang, Cheongju for 64.0 billion won.
5
The debt-to-equity ratio rose from 68.4 percent in 2024 to 87.9 percent in 2025 while operating cash flow fell from 69.5 billion won to 55.0 billion won, so profit growth and cash metrics did not move in the same direction.

Business structure

Founded in 1999, Cosmecca Korea is a cosmetics OEM/ODM that brands its approach as OGM, meaning it also reviews destination-market trends, distribution structures and local regulations. It listed on KOSDAQ in 2016 and is counted alongside Cosmax and Kolmar Korea among Korea's three largest cosmetics OEM/ODM players.

Revenue splits broadly into the Korean entity, US subsidiary Englewood Lab and Chinese unit Cosmecca China. In the second quarter of 2026 the Korean entity led the group with revenue of 178.8 billion won and operating profit of 24.5 billion won, driven by a 94.8 percent year-on-year jump in the skincare category.

Englewood Lab in the US recorded revenue of 51.9 billion won and operating profit of 8.7 billion won in the same quarter, expanding its client base on the back of OTC suncare production infrastructure aligned with US Food and Drug Administration standards and a Ready To Go OTC turnkey solution, for a 16.8 percent operating margin.

Suncare accounts for roughly 35 percent of the US entity's revenue.

By contrast, Cosmecca China posted second-quarter revenue of 7.7 billion won with an operating loss of 1.2 billion won; sales grew 21.3 percent quarter on quarter on wider coverage of Chinese brands and online-based clients, but a return to profit has not yet been confirmed.

The customer mix has shifted from dependence on a few large brands toward many small and indie labels, and Kyobo Securities noted that beyond core creams and tinted sunscreens, orders for hydrogel masks and eye patches are rising, while Englewood Lab is reducing large-client concentration and broadening into US indie brands, luxury skincare and OTC sunscreens.

Manufacturing centers on the Eumseong beauty campuses, with annual capacity of about 1.3 billion units, and following the May 2025 start-up of a new Cheongju site the company acquired the Ochang plant in June 2026 to widen its production base.

Earnings trend

Quarterly revenue · Operating profit

₩161.7B₩23B25Q2₩182.4B₩27.2B25Q3₩178.5B₩21B25Q4₩185.1B₩21.9B26Q1₩226.1B₩32.1B26Q2

RevenueOperating profit

Annual revenue · Operating profit

₩399.4B₩10.4B2022₩470.7B₩49.2B2023₩524.3B₩60.4B2024₩640.9B₩83.5B2025

RevenueOperating profit

Quarterly results · Last 5 quarters
Quarter	Revenue	Operating profit	Op. margin
2025Q2	₩161.7B	₩23B	14.2%
2025Q3	₩182.4B	₩27.2B	14.9%
2025Q4	₩178.5B	₩21B	11.8%
2026Q1	₩185.1B	₩21.9B	11.8%
2026Q2	₩226.1B	₩32.1B	14.2%

Annual results
Year	Revenue	Operating profit	Net income (parent)	Op. margin	ROE	Debt-to-equity
2022	₩399.4B	₩10.4B	₩2.7B	2.6%	1.8%	89.7%
2023	₩470.7B	₩49.2B	₩22.3B	10.4%	13.2%	78.6%
2024	₩524.3B	₩60.4B	₩42.8B	11.5%	19.6%	68.4%
2025	₩640.9B	₩83.5B	₩45.4B	13.0%	18.0%	87.9%

Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-09-04

Earnings analysis

On confirmed figures, consolidated revenue rose for three straight years from 399.4 billion won in 2022 to 470.7 billion in 2023, 524.3 billion in 2024 and 640.9 billion in 2025, while operating profit expanded from 10.4 billion won to 49.2 billion, 60.4 billion and 83.5 billion.

The operating margin improved from 2.6 percent in 2022 to 10.4 percent, 11.5 percent and 13.0 percent, showing that top-line growth came with margin gains.

Quarterly, revenue grew from 161.7 billion won with operating profit of 23.0 billion in the second quarter of 2025 to 226.1 billion won and 32.1 billion in the second quarter of 2026, matching the company's disclosure of a 39.8 percent revenue and 39.3 percent operating profit increase.

Still, the quarterly operating margin slipped from about 14.9 percent in the third quarter of 2025 to roughly 11.8 percent in the fourth quarter and again in the first quarter of 2026, before rebounding to about 14.2 percent in the second quarter, a recurring swing of one to three percentage points driven by product mix and cost timing.

Net profit attributable to owners rose from 9.3 billion won in the second quarter of 2025 to 18.1 billion won in the second quarter of 2026, helped by a smaller minority share of consolidated earnings after the March 2026 increase in the Englewood Lab stake.

For the full year 2025, owners took 45.4 billion won of the 57.8 billion won consolidated net profit, reflecting the persistent gap created by holding a separately listed subsidiary.

The cash picture reads differently: operating cash flow fell from 69.5 billion won in 2024 to 55.0 billion won in 2025, while total liabilities grew from 210.3 billion to 295.6 billion won and the debt-to-equity ratio rose from 68.4 percent to 87.9 percent, consistent with heavier working capital needs alongside expanded investment.

First-half revenue growth of 46.8 percent ranked near the top among 86 listed cosmetics and beauty companies, yet funding for expansion and utilization rates, rather than the absolute profit level, remain the swing factors for the next phase.

Industry analysis

The end market is the Korean cosmetics export cycle. Ministry of Trade, Industry and Energy data show August 2026 cosmetics exports of 1.312 billion dollars, up 52.1 percent year on year, marking a tenth consecutive month of year-on-year growth.

All six of the largest monthly export figures on record were set in 2026, pointing to an expansionary phase. The mix has also changed.

NH Investment and Securities noted that August shipments to Greater China fell 6 percent while non-Greater China regions surged 73 percent, and that the seven main European markets grew to a 14 percent share, comparable to Greater China.

IBK Securities assessed that the center of gravity has shifted from legacy brands reliant on China to US online-driven indie brands and the ODM and distribution agents supporting them.

On competitive positioning, Cosmecca Korea was among the three ODM firms, with Kolmar Korea and Cosmax, that all set record second quarters, with operating profits of 110.3 billion, 73.7 billion and 32.1 billion won respectively, making it the smallest of the three in scale yet comparable on growth and margin improvement.

Supply is tightening. Construction in progress at Cosmax, Cosmecca Korea and Pumtech Korea rose 103.2 percent from 112.1 billion won at end-2025 to 227.8 billion won at end-June 2026, and utilization on some domestic lines has exceeded 100 percent, pushing orders into later periods.

The sector debate is therefore shifting from demand toward the pace of capacity additions and the ability to handle regulation and trade barriers.

Outlook

The company's repeatedly stated medium-term goal is one trillion won in consolidated revenue. Cosmecca Korea described the Englewood Lab tender offer as an execution step toward that target, saying it would strengthen competitiveness on the back of twin production bases linking Korea and the US.

Domestic capacity is in an expansion phase. Samsung Securities said in a July 2026 report that the Eumseong plant is effectively at full utilization because large-client lines occupy it, while the pre-emptively acquired Ochang plant will start operating next year, securing room for new clients.

The company said it would accelerate category expansion by adding hydrogel masks, suncare and premium hair and body care to its skincare-centered manufacturing capability.

In the US, regulatory response is translating into product opportunity: Englewood Lab unveiled proprietary suncare formulations using bemotrizinol (BEMT), the UV filter newly approved by the FDA after 25 years, at the July 2026 Cosmoprof North America show.

On second-half guidance, NH Investment and Securities noted that strong July and August exports led the three ODM firms, Cosmecca Korea, Kolmar Korea and Cosmax, to raise their second-half guidance.

European compliance work is also under way: the company has added management of export documentation related to the EU Packaging and Packaging Waste Regulation to the duties of its global client support staff, and developed 155 sustainable packaging items in 2025 for a cumulative 433.

Conversely, the timing of a return to profit in China and the start-up date and initial depreciation load of the Ochang plant remain undisclosed variables.

Valuation

PER

22.5×

PBR

5.2×

ROE

25.9%

EPS

₩5,977

BPS

₩25,640

Dividend per share

₩0

Earnings-based multiples are now being computed off a completely different baseline than during the profit trough, given the recovery from a 2.6 percent operating margin in 2022 to 13.0 percent in 2025 and further profit growth over the latest four quarters.

Relative to net assets the shares trade at a sizeable premium, which should be read alongside a consolidated equity structure in which the non-controlling interest portion tied to the listed subsidiary is large.

No per-share cash dividend appears in the confirmed data, so dividends contribute nothing here and shareholder-oriented capital allocation has instead taken the form of subsidiary tender offers.

Brokerage targets have been moving up: Kyobo Securities analyst Kwon Woo-jung raised the target price from 130,000 won to 150,000 won on 11 August 2026, and Samsung Securities lifted its target from 90,000 won to 110,000 won on 8 July 2026.

Samsung Securities said at the time that a 12.5 percent rise in the peer average multiple, driven by a supply-demand environment favorable to ODM names, was also reflected in its target.

In other words, current multiples embed both company-level profit improvement and a sector-wide re-rating, and which of the two reverses is the axis of any multiple change.

PER, EPS, PBR and BPS are all calculated in-house (the same method as Naver and Toss) · Dividend yield = cash dividend per share from DART filings (supplemented by KRX) ÷ current price · As of 2026-09-04

Bull factors

Widening client base converting into repeat orders

The company said that new client wins combined with reorders and SKU expansion at existing small and mid-sized clients have established a structure in which initial orders lead to large-scale repeat volumes.

Confirmed financials show second-quarter 2026 revenue of 226.1 billion won, well above the prior quarter's 185.1 billion won. A base of many indie brands rather than a few large accounts spreads the impact of losing any single client. That said, this structure must be weighed against the potentially short life cycle of individual brand hits.

Dual production bases in Korea and the US

Englewood Lab has secured local and global indie brands as clients on the back of US production facilities and R&D capability, and is regarded as a rare case of a Korean ODM building a working North American production and development system.

The company said Englewood Lab's US manufacturing base can help K-beauty brands secure local production and address tariff issues when entering the US. The stake rose to 66.67 percent in March 2026, increasing its contribution to consolidated earnings.

On the other hand, the US operation carries its own margin volatility from a labor and logistics cost structure unlike Korea's.

Pre-emptive capacity to absorb orders

The company acquired the land and buildings of the Ochang plant for 64.0 billion won in June 2026 and said it would raise capacity beyond the roughly 1.3 billion units per year it already has.

Industry participants note that because new plants take time to ramp, firms are first squeezing efficiency from existing lines, but that this alone cannot resolve the supply shortfall, so further expansion will likely be needed. With utilization already high, pre-secured facilities raise the ceiling on order intake. Still, the actual start-up date and the pace of absorbing initial fixed costs are not yet confirmed.

Bear factors

Recurring swings in quarterly margins

On confirmed quarterly figures the operating margin fell from about 14.9 percent in the third quarter of 2025 to roughly 11.8 percent in the fourth quarter and again in the first quarter of 2026, then rebounded to about 14.2 percent in the second quarter.

That is a swing of around three percentage points even within an expansion phase. With product mix, start-up costs for new lines and currency effects overlapping, extrapolating any single quarter's margin across a full year is difficult.

Such variability draws less attention while revenue growth is high, but shows through directly in profit once growth slows.

Rising cash flow and leverage burden

Operating cash flow declined from 69.5 billion won in 2024 to 55.0 billion won in 2025, even as operating profit rose from 60.4 billion to 83.5 billion won. Total liabilities grew from 210.3 billion to 295.6 billion won and the debt-to-equity ratio rose from 68.4 percent to 87.9 percent.

On top of that came a March 2026 tender offer for 3,311,310 Englewood Lab common shares at 13,000 won per share and the June acquisition of the Ochang plant for 64.0 billion won, equal to 10.13 percent of consolidated assets at end-2025. This is a period in which growth investment and balance-sheet capacity need to be monitored together.

Dependence on the export cycle and base effects

Because monthly Korean cosmetics exports set successive all-time highs through 2026, a high base could compress growth rates from 2027. NH Investment and Securities expects temporary volatility in September figures owing to the shifted timing of the Chuseok holiday and prior-year base effects.

ODM results lag brand clients' sell-through and inventory policies, so any slowdown in export growth feeds into orders with a delay. With 26 of 86 listed cosmetics and beauty companies posting operating losses in the second quarter of 2026, performance dispersion within the sector is also widening.

Risk factors

Trade and tariffs

The US Trade Representative announced finalized tariffs of 10 to 12.5 percent on 60 countries over imports of goods made with forced labor, with 12.5 percent applied to Korea. An academic noted that because consumer goods such as cosmetics are price sensitive, even an extra 2.5 percent can have a real impact.

The UK and EU are also scaling back or abolishing duty exemptions for low-value imports, changing the cost structure of direct-shipment models. US local production can act as a buffer, but volumes made in Korea and shipped to the US are directly exposed to tariff changes.

Regulation and certification

The European Commission amended the annexes to the Cosmetics Regulation to tighten restrictions on newly designated CMR substances, effective 1 May 2026, and products containing them may require reformulation or substitute ingredients. The EU Packaging and Packaging Waste Regulation has also begun to apply.

The US regulates SPF-labeled products as OTC drugs, requiring compliance with the OTC sunscreen monograph plus drug establishment registration and an NDC number. Compliance capability can act as a barrier to entry for ODMs, but reformulation and retesting weigh on lead times and costs.

China operations and governance

Cosmecca China posted second-quarter 2026 revenue of 7.7 billion won with an operating loss of 1.2 billion won. The company said it is adding suncare to cushions and primers to improve profitability, but gave no timeline for a return to profit.

On governance, consolidating a separately listed subsidiary has produced a persistent gap between consolidated and owner-attributable net profit; in 2025, owners took 45.4 billion won of the 57.8 billion won consolidated figure. Buying more of the subsidiary narrows that gap, but it also consumes cash.

What to watch next

On or around 1 October 2026
Check cosmetics export value and regional mix in the Ministry of Trade, Industry and Energy's September trade data. Since NH Investment and Securities flagged September volatility from holiday timing and base effects, whether the monthly trend breaks serves as a leading indicator for ODM orders.
Mid-November 2026
Third-quarter 2026 results and the quarterly report will show whether revenue growth and the operating margin hold near the second-quarter level of about 14 percent. Key items are the profit contribution by entity for Korea, Englewood Lab and China, and whether the Chinese loss narrows.
Q4 2026 to H1 2027
Watch for the actual start-up date and initial utilization of the Ochang plant. Samsung Securities said in a July 2026 report that Ochang would begin operating next year, securing room for new clients, so disclosures on completion of the investment and the scale of depreciation recognition matter for margins.
Around February 2027
This is when preliminary full-year 2026 results and any dividend decision appear. The checks are whether annual revenue and operating margin sustained the first-half trend, and how cash flow and the debt-to-equity ratio settle after the large capex and subsidiary share purchases.
Ongoing from Q4 2026
Track how changes in the scope of the US 12.5 percent tariff and follow-on requirements under the EU PPWR now in force flow into costs and lead times. The observable point is any shift in allocation between US-bound volumes made in Korea and those produced locally by Englewood Lab.

Overall view

Cosmecca Korea has improved both revenue and margins during the expansion phase of the K-beauty export cycle. Consolidated revenue rose from 399.4 billion won in 2022 to 640.9 billion won in 2025 and operating profit from 10.4 billion to 83.5 billion won, lifting the operating margin from 2.6 percent to 13.0 percent.

The second quarter of 2026 was a record quarter with revenue of 226.1 billion won and operating profit of 32.1 billion won, led by the Korean entity's skincare category, up 94.8 percent year on year.

On the other side sits a heavier balance sheet: operating cash flow fell from 69.5 billion won in 2024 to 55.0 billion won in 2025 and the debt-to-equity ratio rose from 68.4 percent to 87.9 percent, even as the 64.0 billion won Ochang plant acquisition and the increase in the Englewood Lab stake to 66.67 percent came due.

The Chinese unit remains loss-making at the operating level, while the US 12.5 percent tariff and tighter EU ingredient and packaging rules are external variables that can affect costs and lead times.

The order of verification is therefore clear: whether double-digit revenue growth and an operating margin near 14 percent persist beyond the third quarter, when Ochang's start-up flows into results, and whether cash flow absorbs the increased investment burden. This report is for information purposes and contains no buy or sell opinion on any security.

Sources

Korea Exchange (KRX) — Prices · Market Cap · Volume
FSS electronic disclosure system (DART) — Financial statements · Dividend filings

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Report written 2026-09-05 · Data as of 2026-09-04

This content is AI analysis of market data and web search results, provided for information only. It is not a solicitation or recommendation to invest. Investment decisions and their consequences are the investor's own responsibility. Data may be delayed or contain errors.