1. Lotte Rental Q2 Earnings: What Were the Results?

While Lotte Rental met revenue expectations, operating and net profits fell short. This is attributed to factors like rising costs and intensified competition.

  • Revenue: KRW 748.8 billion (Met expectations)
  • Operating Profit: KRW 77.2 billion (-3.1% vs. expectations)
  • Net Profit: KRW 30.2 billion (-2.3% vs. expectations)

2. Why the Underperformance?

Key factors contributing to the weaker-than-expected results include rising interest rates impacting financing costs, increased competition in the short-term rental market, and the rising KRW/USD exchange rate. On the positive side, Lotte Rental maintained solid revenue growth and continued its expansion into new business areas.

  • Negative Factors: Rising Interest Rates, Increased Competition, Exchange Rate Volatility
  • Positive Factors: Solid Revenue Growth, New Business Expansion (Agricultural Machinery, Freight Transportation Brokerage)

3. Lotte Rental’s Outlook and Investment Strategy

Lotte Rental is securing growth momentum through business diversification, but profitability remains a key challenge. Investors should focus on the following:

  • Profitability Improvement Strategy: Cost efficiency, enhancing profitability in the short-term rental segment
  • New Business Performance Monitoring: Market penetration and profitability of new ventures
  • Impact of Potential Change in Majority Shareholder: Potential changes in governance and management strategy
  • Responding to Macroeconomic Variables: Managing interest rate and exchange rate volatility