KOSPIApparel & Living383220

F&F

₩69,400▲ 0.29%2026-10-02 close

Market Cap

₩2.7T

Turnover

₩1.7B

Volume

20,000 shares

Shares out.

38.3M

PER

4.8×

PBR

1.2×

EPS

₩13,949

Dividend Yield

4.04%

PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩2,700 per share · Prices as of the 2026-10-02 close

Report overview

MLB at Home and in China, With TaylorMade at a Crossroads

Inbound-driven MLB demand at home and inventory throttling in China have lifted the top line while capping margins, with the TaylorMade sale-or-buy process standing as a separate swing factor.

1
Q2 2026 revenue was KRW 399.6bn and operating profit KRW 86.5bn, up 5.5% and 2.9% year on year, while first-half cumulative revenue of KRW 960.5bn and operating profit of KRW 240.0bn rose 8.6% and 15.6%.
2
The China entity generated KRW 177.6bn in Q2 2026, or 44.5% of group revenue, making it effectively the single largest business pillar.
3
Domestic MLB non-duty-free sales grew 18% in Q2 while Discovery declined about 5%, underscoring a sharp divergence between brands.
4
Gross margin improved, but SG&A rose 11% on items such as higher China advertising costs amid a stronger yuan, so the Q2 operating margin slipped 0.5 percentage point year on year to 21.6%.
5
The TaylorMade re-sale process and whether F&F exercises its right of first refusal remain unresolved; the company extended a KRW 4tn acquisition-financing commitment with three brokerages by six months.

Business structure

F&F is a brand operator whose core portfolio comprises MLB and MLB Kids, built on a Major League Baseball license, plus the outdoor brand Discovery Expedition, alongside in-house brands such as Duvetica.

It is described as a global fashion company running licensed brands including MLB and Discovery Expedition together with its own brands such as Duvetica.

Its growth formula rests on reinterpreting the familiar MLB sports intellectual property as a fashion lifestyle brand and extending it beyond baseball merchandise into caps, apparel, footwear and bags.

Revenue splits between domestic non-duty-free, duty free and kids channels and overseas entities in China, Hong Kong and Southeast Asia. In Q2 2026 the China entity posted KRW 177.6bn, equal to 44.5% of the group's KRW 399.6bn revenue, per a Korea Federation of Textile Industries analysis in August 2026.

Its local network stands at 923 MLB stores and 27 Discovery stores in China, roughly 1,062 doors in total. At home, flagship stores in prime districts have seen expanding sales to foreign tourists.

On competition, Misto Holdings, which runs Fila and owns Acushnet, ranked first in operating profit among listed textile and fashion firms in the first half of 2026, while F&F placed in the upper tier.

Over the same period Kolon Industries' fashion division grew operating profit 117.3% and Shinsegae International returned to profit, showing peers are also restructuring.

On ownership, F&F Holdings and related parties hold 62.8%, the National Pension Service 8.3% and VIP Asset Management 7.2%, with foreign ownership at 13.2%, leaving a limited free float.

Earnings trend

Quarterly revenue · Operating profit

₩378.9B₩84B25Q2₩474.3B₩128B25Q3₩575.3B₩132.9B25Q4₩560.9B₩153.5B26Q1₩399.6B₩86.5B26Q2

RevenueOperating profit

Annual revenue · Operating profit

₩1.8T₩524.9B2022₩2T₩551.8B2023₩1.9T₩450.7B2024₩1.9T₩468.6B2025

RevenueOperating profit

Quarterly results · Last 5 quarters
Quarter	Revenue	Operating profit	Op. margin
2025Q2	₩378.9B	₩84B	22.2%
2025Q3	₩474.3B	₩128B	27.0%
2025Q4	₩575.3B	₩132.9B	23.1%
2026Q1	₩560.9B	₩153.5B	27.4%
2026Q2	₩399.6B	₩86.5B	21.6%

Annual results
Year	Revenue	Operating profit	Net income (parent)	Op. margin	ROE	Debt-to-equity
2022	₩1.8T	₩524.9B	₩441.8B	29.0%	47.9%	66.5%
2023	₩2T	₩551.8B	₩425.1B	27.9%	32.9%	52.2%
2024	₩1.9T	₩450.7B	₩360.4B	23.8%	23.1%	44.9%
2025	₩1.9T	₩468.6B	₩398.5B	24.2%	21.2%	41.1%

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, 2025 consolidated revenue was KRW 1,934.0bn, operating profit KRW 468.6bn and net profit attributable to owners KRW 398.5bn.

That is modestly above 2024's KRW 1,896.0bn revenue and KRW 450.7bn operating profit, yet earnings remain below 2023's KRW 1,978.5bn revenue and KRW 551.8bn operating profit, so the profit line is still mid-recovery.

The operating margin fell from 29.0% in 2022 to 27.9% in 2023 and 23.8% in 2024 before edging up to 24.2% in 2025.

Quarterly patterns are highly seasonal: from Q2 2025 revenue of KRW 378.9bn and operating profit of KRW 84.0bn (22.2% margin), the business built to KRW 474.3bn/KRW 128.0bn in Q3, KRW 575.3bn/KRW 132.9bn in Q4 and KRW 560.9bn/KRW 153.5bn (27.4%) in Q1 2026, then returned to off-season levels in Q2 2026 at KRW 399.6bn/KRW 86.5bn (21.6%).

Versus the prior quarter, Q2 revenue fell 28.8% and operating profit 43.6%, which the company attributed to seasonal quarterly swings inherent to the fashion business.

On margins, disciplined inventory and full-price sell-through lifted the Q2 gross margin by 2.1 percentage points, but SG&A rose 11% on items such as higher China advertising spend amid a stronger yuan, trimming the operating margin by 0.5 percentage point, according to Daishin Securities on July 31, 2026.

Notably, in Q4 2025 and Q1 2026 net profit attributable to owners (KRW 154.5bn and KRW 197.6bn) exceeded operating profit, indicating quarters in which non-operating items lifted the bottom line.

The balance sheet showed end-2025 equity of KRW 1,878.7bn against liabilities of KRW 772.8bn, a 41.1% debt-to-equity ratio, down steadily from 66.5% in 2022.

Operating cash flow, however, declined for three straight years, from KRW 477.0bn in 2023 to KRW 398.8bn in 2024 and KRW 355.2bn in 2025, while non-controlling interests were reduced to zero in 2025, simplifying the consolidation structure.

Industry analysis

End demand moves along two tracks, domestic and China. At home, recovering fashion consumption sentiment and a larger influx of foreign tourists have been driving results, favoring operators with strong brand equity in inbound channels.

In China, apparel retail sales reached CNY 412.2bn in Q1 2026, up 9.3% year on year, pointing to a gradual recovery.

Currency translation matters greatly, however: China MLB revenue rose 4% in won terms, but with the won-yuan rate up 14%, underlying yuan-based sales were estimated to have fallen about 10% (Daishin Securities, July 31, 2026). In cycle terms the company looks to be in the later stage of inventory correction.

It sustained MLB retail sell-through while throttling shipments to normalize inventory in some categories, defending profitability, and Discovery settled into premium local positioning with low discount rates, according to industry analysis.

Against peers, Misto Holdings enjoyed strong golf equipment momentum with Acushnet's Q2 revenue up 22% and operating profit up 75%, highlighting how earnings drivers diverge between golf-equipment-heavy operators and branded apparel players.

At the same time, some observers have argued the global golf market has entered a downturn. With channel mix, currency and inventory all acting at once, revenue growth and margins can move in different directions from quarter to quarter.

Outlook

With its Q2 release the company said it plans to keep strengthening its domestic and overseas growth base in the second half through better product competitiveness and retail expansion in new overseas markets.

On sell-side estimates, Daishin Securities said in a July 31, 2026 report that it projects 2026 revenue of KRW 2,073bn and operating profit of KRW 538bn, cutting its prior revenue and operating profit forecasts by 1.1% and 2.2%, and forecast annual MLB revenue of KRW 1,415bn with growth of 16.9% in domestic non-duty-free, 9.0% in China and 18.8% in Hong Kong plus Discovery revenue of KRW 344bn, down 1.0% year on year.

The same report expected China to grow 6-7% in the second half, with won-denominated sales rising steadily on currency effects even if yuan-based sales do not increase much.

On store rollout, SK Securities said in a July 2026 report that Discovery had 27 stores in China with expansion slated for the F/W season, while Samsung Securities said in an April 2026 report that expansion toward a 40-store target for 2026 was under way.

On target prices, Hanwha Investment & Securities said in an August 3, 2026 report that it maintained a Buy rating while lowering its target price to KRW 100,000, and Eugene Investment & Securities said in a June 2026 report that it maintained a Buy rating and a KRW 100,000 target price.

Execution of the company's own plan also bears watching: its first corporate value-up plan in April 2025 set a 10% average annual revenue growth target through 2027, but first-year growth came in at 2%, and of a promised KRW 60bn-plus three-year buyback only KRW 6.5bn was executed in the first year.

Daishin Securities analyst Yoo Jung-hyun wrote on July 31, 2026 that with China prioritizing inventory health, second-half growth and whether the TaylorMade acquisition proceeds would be the main share-price variables.

Valuation

PER

4.8×

PBR

1.2×

ROE

28.3%

EPS

₩13,949

BPS

₩54,907

Dividend per share

₩2,700

F&F's trailing four-quarter earnings (Q3 2025 to Q2 2026) run above its last confirmed annual figures, so its price-to-earnings multiple sits toward the low end relative to Korean consumer-sector averages.

Eugene Investment & Securities said in a June 2026 report that the shares traded at roughly 6-7 times forecast earnings for the coming 12 months and that TaylorMade-related potential value was not sufficiently reflected in the price, while Samsung Securities said in an April 2026 report that it cut its target multiple from 9 times to 8 times on weaker sentiment tied to global consumption slowdown concerns.

Against net assets the share price sits above book value, though investors should note that book value per share differs between the in-house calculation and the exchange's published figure, producing slightly different price-to-book readings.

On distributions, the 2025 shareholder return ratio on a separate basis reached 27%, beating its target, and dividend-led returns grew enough for the company to qualify as a high-dividend firm under Korean tax incentive law, leaving the dividend yield above the domestic market average.

That said, how the earnings multiple should be read could change materially depending on the treatment of the TaylorMade stake; SK Securities noted in a July 2026 report that TaylorMade's equity value is not currently reflected in the financial statements.

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

Domestic MLB and inbound demand

Domestic MLB non-duty-free sales rose 18% in Q2 2026, attributed to expanding sales to foreign tourists at flagship stores in prime districts, while MLB Kids sales grew 20%. The company said domestic revenue rose 4.9% on strong MLB accessory sales and channels with a high share of foreign customers.

Brand recognition converting directly into sales through inbound channels offers marketing efficiency benefits. Still, such demand is linked to tourism policy and exchange rates, so its durability requires separate confirmation.

Scale and inventory discipline in China

The China entity generated KRW 177.6bn in Q2 2026, or 44.5% of group revenue, supported by 1,062 local doors including 923 MLB and 27 Discovery stores.

The company said it flexibly adjusted shipment timing and volumes to match local consumer sell-through, which limited revenue growth while consumer sales held firm at levels similar to a year earlier.

Because shipments were curtailed to manage inventory, room remains for shipments to normalize once inventory is cleaner. Discovery is also assessed to have settled into premium local positioning with low discount rates, driving S/S apparel sales growth.

Lower financial leverage and return capacity

On confirmed financials the debt-to-equity ratio fell from 66.5% in 2022 to 41.1% in 2025, with 2025 equity at KRW 1,878.7bn. Shareholder returns combine dividends and buybacks, the minimum dividend floor was raised, and the 2025 separate-basis return ratio of 27% exceeded the target.

Daishin Securities said in a May 2026 report that improving earnings made a dividend increase likely and that the shareholder return ratio was expected to rise year on year. Any expansion, however, is a board decision, so actual execution must be verified.

Bear factors

Discovery's decline and brand concentration

Discovery sales fell about 5% in Q2 2026, extending Q1's decline, and Daishin Securities projected 2026 revenue of KRW 344bn, down 1.0% year on year. With heavy reliance on MLB, weakness in the second pillar increases growth volatility.

Hanwha Investment & Securities said in a July 2026 report that domestic Discovery fell 5% but that the pace of decline was moderating versus the prior year. When Discovery's China store rollout translates into earnings remains to be confirmed.

Margins capped by rising costs

On confirmed results the operating margin fell from 29.0% in 2022 to 24.2% in 2025 and stood at 21.6% in Q2 2026. SG&A rose 11% on items such as higher China advertising costs amid a stronger yuan, cutting the Q2 operating margin by 0.5 percentage point year on year, per Daishin Securities on July 31, 2026.

The same report noted that both Q2 revenue and operating profit came in slightly below its estimates and consensus. The currency effect cuts both ways, aiding reported revenue while also inflating local costs.

Two-sided TaylorMade uncertainty

F&F extended by six months a KRW 4tn acquisition-financing and bridge-loan commitment with Samsung Securities, Mirae Asset Securities and Korea Investment & Securities, while cash and equivalents stood at KRW 325.4bn at end-2025, or KRW 397.0bn on a holding-company consolidated basis.

In September 2025, Invest Chosun reported that acquisition financing secured against TaylorMade shares was being discussed at rates as high as 8-10% and that, unlike dollar-holding foreign bidders, F&F is exposed to currency risk.

Conversely, if the process ends in a sale, large cash inflows would arrive but the chance to consolidate the business would disappear. Eugene Investment & Securities noted that in an acquisition scenario, initial one-off costs would inevitably dent near-term per-share earnings.

Risk factors

China concentration and currency

With the China entity accounting for 44.5% of group revenue in Q2 2026, local consumption, distribution policy and yuan moves feed directly into results. The estimate that underlying yuan-based sales fell about 10% while the won-yuan rate rose 14% illustrates the sensitivity should currency tailwinds fade.

Shifting shipment timing to manage inventory also reduces the predictability of quarterly results. Marketing intensity from local competing brands is a further cost variable.

License-based business model

The core brands MLB and Discovery Expedition are classified as licensed brands, while in-house brands make up a relatively small share. Renewal terms and royalty structures are preconditions for the business, so contract-related disclosures and annual report descriptions warrant review.

Without owning the brand IP, geographic expansion can also be constrained by contract terms. How far in-house brand development reduces this dependence is a medium-term checkpoint.

Governance and free float

F&F Holdings and related parties hold 62.8%, leaving a limited free float, and free float has been cited at around 35% (Mirae Asset Securities, May 2026). Separating the board chair role has been flagged as the remaining governance task.

It has also been argued that the holding company's earnings and dividend sources are effectively concentrated in the subsidiary F&F, whose own growth targets have been missed. Investors should track both the effective dates of minority-shareholder-related rule changes and actual execution.

What to watch next

September to December 2026
The conclusion of the TaylorMade re-sale process. F&F is expected to decide on exercising its right of first refusal after confirming Entrada's final price and currency trends, while Centroid faces a fund maturity early the following year. Either an acquisition or a sale would materially affect funding structure and financial metrics, so disclosures should be monitored.
Late October to early November 2026
The Q3 2026 earnings release. Against Q3 2025 revenue of KRW 474.3bn and operating profit of KRW 128.0bn, it should show whether China shipments have normalized after the throttling and which way the operating margin, pressured by higher SG&A, is heading.
Q4 2026
China F/W store openings and year-end shopping events. SK Securities said in a July 2026 report that Discovery had 27 China stores with expansion slated for the F/W season, and Samsung Securities cited a 40-store target for 2026. This is the window to verify actual openings and the revenue contribution of new doors.
The first shareholder meeting electing directors after September 10, 2026
Actual application of governance rule changes. F&F removed the clause excluding cumulative voting from its articles at its annual meeting, and the change applies from the first shareholder meeting electing directors after September 10, 2026. Whether board composition and minority shareholder rights change in practice is the point to verify.
January to March 2027
The fiscal 2026 year-end dividend and shareholder-return execution. Following an articles amendment, the declare-first, record-date-later procedure is set to apply from the fiscal 2026 year-end dividend, and this is also the point to check progress on the promised three-year buyback of at least KRW 60bn.

Overall view

F&F's first half of 2026 delivered growth in both revenue and profit, but the quality of that growth differed between Korea and China.

On confirmed figures, Q2 2026 revenue was KRW 399.6bn with operating profit of KRW 86.5bn, and for the first half revenue of KRW 960.5bn and operating profit of KRW 240.0bn rose 8.6% and 15.6% respectively.

Domestically, MLB non-duty-free and kids lines grew at double-digit rates, while in China the company accepted limited revenue recognition from shipment throttling in exchange for cleaner inventory and full-price sell-through.

The operating margin, however, fell from 29.0% in 2022 to 24.2% in 2025 and 21.6% in Q2 2026, showing cost structure weighing on margins, and Discovery kept contracting. The balance sheet looks stable with the debt-to-equity ratio down to 41.1%, yet operating cash flow declined for three consecutive years.

On top of this, the TaylorMade re-sale process and the right-of-first-refusal decision remain unresolved, creating two very different financial pictures: funding strain if it acquires, cash inflows if it sells.

The supportive factors are brand-driven inbound demand at home and the scale of the China store network; the offsetting factors are rising costs, brand concentration and TaylorMade-related uncertainty, with the next checkpoints being Q3 results, China F/W store openings and the conclusion of the sale process.

Sources

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

Show 18 more articles and sources

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.