Hanwha Galleria

Hanwha Galleria was established through a spin-off from Hanwha Solutions in March 2023 as a dedicated department store operator. It runs five stores centered on the Apgujeong flagship (EAST and WEST wings) in Seoul, plus Gwanggyo, Daejeon Timeworld, Cheonan Centercity, and Jinju.

About 80% of total revenue comes from the department store segment, and the Apgujeong flagship alone accounts for roughly 40% of the department store division's transaction value across the five stores.

The flagship was the first in Korea to house Hermes, Louis Vuitton and Chanel together, alongside high-end names such as Cartier and Patek Philippe, and has recently added high jewelry and watch brands including Moser & Cie and Wellendorff to court VIP customers.

On diversification, under Vice Chairman Kim Dong-sun the company pursued a sale of Five Guys operator FG Korea, selecting private equity firm H&Q Equity Partners as preferred bidder, while acquiring Ourhome, Parascala, and Pure Plus to reshape its F&B and lifestyle portfolio.

More recently the strategy has pivoted from F&B-led expansion toward concentrating resources on the core department store business and the flagship rebuild.

Korea's department store market remains dominated by the three major groups—Lotte, Shinsegae and Hyundai—leaving Hanwha Galleria positioned as a relatively smaller operator by store count and revenue scale.

On an annual basis, revenue rose from KRW 434.5 billion in 2023 (operating profit KRW 9.8 billion, 2.3% margin, owner net loss of KRW 30.1 billion) to KRW 538.3 billion in 2024, but operating profit fell to KRW 3.1 billion (0.6% margin) and the owner net loss widened to KRW 18.8 billion as margins compressed even as sales grew.

In 2025, revenue reached KRW 575.2 billion with operating profit of KRW 9.4 billion (1.6% margin), and the company posted an owner net profit of KRW 3.3 billion, marking a return to profitability.

By quarter, 2025 Q2 was weak with revenue of KRW 126.9 billion, an operating loss of KRW 4.9 billion, and a net loss of KRW 14.3 billion, but Q3 revenue of KRW 125.6 billion came with an operating profit of KRW 3.4 billion, turning the operating line positive.

Q4 revenue climbed to KRW 193.4 billion on seasonal strength, with operating profit of KRW 9.1 billion and net profit of KRW 25.0 billion—the net figure well exceeding the operating figure suggests a one-off item may have been included.

In 2026, operating profit expanded for a second straight quarter, from KRW 12.3 billion in Q1 (revenue KRW 126.1 billion, net loss of KRW 0.8 billion) to KRW 15.1 billion in Q2 (revenue KRW 150.9 billion, net profit of KRW 5.1 billion).

The company attributed the Q2 swing to profit to growing luxury demand and foreign-customer sales, and commentary points to inbound foreign visitors topping 10 million in the first half of 2026 as a supportive factor for luxury spending.

Summed over the trailing four quarters (Q3 2025 through Q2 2026), owner net profit totals KRW 26.3 billion, a clear recovery from the full-year loss recorded in 2024.

Korea's department store industry is being described as enjoying a boom period. Lotte Department Store's Q1 revenue rose 8.2% year-on-year to KRW 872.3 billion, with operating profit up 47.1% to KRW 191.2 billion.

Shinsegae's department store division posted Q1 revenue of KRW 2.03 trillion, up 13.0%, and operating profit of KRW 141.0 billion, up 30.7%, marking a record high. Hyundai Department Store's Q1 department store segment recorded net sales of KRW 632.5 billion and operating profit of KRW 135.8 billion.

Against these three major players, Hanwha Galleria is a clearly smaller operator by store count (five) and revenue scale.

While the industry-wide tailwinds of rising luxury spending and inbound tourism benefit Hanwha Galleria as well, competitors have largely completed major store renovations and expansions, whereas Hanwha Galleria is only now beginning the rebuild of its core Apgujeong flagship, leaving it relatively behind in the investment cycle.

Hanwha Galleria's top strategic priority is the rebuild of the Apgujeong flagship's east and west wings.

Seoul's Urban and Architecture Joint Committee's delegated subcommittee approved a revised urban plan for the project in September 2025, and in May 2026 the 7th Architecture Committee review passed the agenda covering both the east and west wing construction.

Under the plan, sales floor area would expand from about 8,300 pyeong to more than 18,000 pyeong, incorporating a design by globally renowned architect Thomas Heatherwick.

The investment is slated at roughly KRW 900 billion over six years from 2027 to 2033, though industry estimates suggest the figure could range up to KRW 1 trillion.

Industry watchers expect the flagship to suspend operations in phases as early as 2027 if the plan proceeds as scheduled, meaning the loss of the core store's sales could weigh on near-term results.

On financing, the company's total debt to EBITDA ratio stands at around 7.4 times, a level seen as making it difficult to fund the project from operating cash flow alone, raising the possibility of leveraging its roughly KRW 1 trillion in real estate assets through mortgage financing or asset securitization.

Separately, the company continues to broaden its lifestyle business base through acquisitions such as Ourhome and Parascala.