LG Household & Health Care (051900.KS) Q1 2026: Operating Profit Slides 24% as China Exit Erodes Revenue Base
Revenue fell 7.1% year-on-year to ₩1,576.6 billion in the first quarter of 2026, with the operating margin compressing 154 basis points to 6.84% — a direct consequence of volume deleverage as LG H&H accelerates its withdrawal from the Chinese cosmetics market, including the liquidation of its Beijing joint venture.
Source: Q1 2026 Quarterly Report — Filed May 15, 2026 with DART | Consolidated Financial Statements | Unit: ₩ billions
LG Household & Health Care's first quarter of 2026 continued the trajectory established in 2025: sustained revenue contraction from its China cosmetics business, operating deleverage as fixed costs absorb a shrinking revenue base, and yet a structurally resilient balance sheet that insulates the company from financial stress. Consolidated revenue fell 7.1% year-on-year to ₩1,576.6 billion, operating profit contracted 24.3% to ₩107.8 billion, and net income declined 14.2% to ₩88.7 billion — the last figure benefiting from a lower effective tax rate and improved financial income. The full-year 2025 comparison is stark: operating profit of just ₩170.7 billion on ₩6,355.5 billion of revenue, and a net loss of ₩85.8 billion, the company's worst annual result in recent history. Against that benchmark, Q1 2026 — despite the revenue headwinds — represents a modest stabilization, with a positive quarterly operating income of ₩107.8 billion alone already exceeding 63% of the entire FY2025 operating profit. The structural drag is real, but the pace of deterioration appears to be decelerating. A critical structural development is disclosed in the filing: BEIJING LG HOUSEHOLD CHEMICAL CO., LTD., the China joint venture, entered liquidation proceedings and ceased operations after the report filing date of May 15, 2026, formally marking the completion of LG H&H's exit from manufacturing in China.
