CEO Greeting
Achieving Another Record Performance in 2024
In 2024, consolidated revenue reached KRW 79.4 billion, representing an increase of KRW 6.8 billion (9.4%) compared to the previous year (2023). Operating profit rose to KRW 10.6 billion, up KRW 1.6 billion (18%) year-on-year. Net profit for the year amounted to KRW 10.4 billion, reflecting an increase of KRW 3.7 billion (56%) compared to the prior year. As a result, the Company has achieved record-high performance for four consecutive years since its founding.
[ Unit: KRW million, Operating Margin % ]
| Category | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|
| Consolidated Revenue (KRW billion) | 487 | 643 | 726 | 794 |
| Consolidated Operating Profit (KRW billion / %) | 37 (7.6%) | 53 (8.3%) | 90 (12.5%) | 106 (13.4%) |
| Consolidated Net Profit (KRW billion / %) | 16 (3.3%) | 201 (31.3%) | 67 (9.2%) | 104 (13.1%) |
Notably, on a consolidated basis, the operating margin improved from 7.6% in 2021 to 13.4% in 2024, demonstrating healthy growth in which revenue expansion has been accompanied by enhanced profitability.
Establishment of the U.S. Sales Subsidiary in 2024
In 2024, the Company established a sales subsidiary in the United States, the world's largest cosmetics market, and began direct sales activities to U.S. customers starting February 15, 2025. In particular, the advanced U.S. subsidiary obtained Certified Vendor status from Estée Lauder, which is essential for B2B sales in the U.S. cosmetic ingredients market. As a result, the Company has begun direct transactions with Estée Lauder. This certification is also expected to create opportunities for the U.S. subsidiary to act as a sales representative for both domestic and international cosmetic ingredient companies in the Americas going forward.
K-Beauty: The World's Second-Largest Cosmetics Exporter
In 2024, South Korea's cosmetics exports grew by approximately 25% year-on-year, driven by the global popularity of K-Beauty, surpassing KRW 14 trillion in total value. In particular, exports to the U.S. market recorded a remarkable growth rate of 57%, achieving exports of approximately KRW 2.8 trillion.
Entry into the Clinical Testing Business
Beginning in June 2024, the Company entered the skin clinical testing business. Within just six months of preparation, the Company successfully secured personnel, facilities, and software, enabling a rapid launch of this new business. The decision to enter the clinical testing market was driven by the Company's positive outlook on the domestic clinical testing industry.
The key reasons include: (1) Korea's enforcement of mandatory human application testing under its cosmetics advertising substantiation system; (2) the global rise of indie brands alongside K-Beauty; (3) the growth of online commerce, which has weakened consumer loyalty to established brand names; (4) increased consumer interest in individual product efficacy and usage; and (5) the rapid growth of K-Beauty exports to the U.S., which is driving increased demand for clinical testing among domestic indie brands to prepare for MoCRA and OTC compliance.
The clinical testing business is expected to achieve profitability starting in 2025. In the field of sunscreen testing, the Company has already secured the industry's third-largest scale of UV testing equipment and test beds. The Company aims to enter the top five clinical testing providers within the next three years.
The First Year of the ODM Business
The Company is entering the ODM business in earnest. The factory currently under construction includes manufacturing facilities with a total floor area of 4,718㎡, along with auxiliary facilities. The total investment amounts to KRW 20.8 billion, with commercial production scheduled to begin on July 1. As of March 25, construction progress has reached 77%.
[View of the ODM factory and auxiliary buildings under construction]
Leveraging the Company's accumulated experience in manufacturing sunscreen ingredients (API: Active Pharmaceutical Ingredient) and its successful FDA inspection in 2019 as Korea's first manufacturer of API sunscreen ingredients, the new facility aims to establish a unique value chain spanning cosmetic ingredient manufacturing, clinical testing, ODM cosmetics production, and brand development—pioneering a path unmatched within the K-Beauty industry.
Headquarters Relocation
In February 2025, the Company relocated its Seoul headquarters from Hanwha BizMetro 2 to Urban Work Building 2, which is closer to Gasan Station. The relocation was driven by the expansion of the ODM business, which requires rapid research and development support. Accordingly, the existing Hanwha BizMetro facility has been repurposed as the ODM R&D center, while the headquarters functions for the clinical business, materials business, brand operations, and management support were moved to Urban Work.
[Hanwha BizMetro ODM R&D Center]
Through this reorganization, the Company aims to maximize synergies across its businesses, establishing itself as a ONE-STOP beauty company encompassing cosmetic ingredients, ODM finished product manufacturing, brand operations, and skin clinical testing.
First, I would like to briefly review the Company's performance in 2023.
In 2023, Sunjin Beauty Science once again achieved its highest-ever results in both revenue and profit, following the record performance achieved in the previous year (2022).
Total revenue for 2023 amounted to KRW 72.6 billion, representing an increase of KRW 8.29 billion (13% year-on-year) on a consolidated basis compared to 2022. Operating profit reached KRW 9.0 billion, up KRW 3.7 billion (69% year-on-year).
Given the sharp revenue growth in 2022—when consolidated revenue increased by 32% to KRW 64.3 billion from KRW 48.7 billion in 2021—some market participants expressed concerns that performance in 2023 might soften. However, the Company successfully overcame these concerns and demonstrated that it has entered a solid and sustainable growth trajectory.
Increase in Operating Profit Driven by Growth in High Value-Added Cosmetic Ingredients
One of the most notable aspects of the Company's 2023 performance was the significant increase in operating profit, driven by two key factors.
First, revenue from high value-added cosmetic ingredients continues to grow.
| Category | 2019 | 2020 | 2021 | 2022 | 2023 |
|---|---|---|---|---|---|
| Cosmetic Ingredient Revenue (KRW bn) | 301 | 290 | 335 | 433 | 495 |
Second, operating profit leverage driven by improved manufacturing productivity
Since the completion of the Janghang plant in 2019, the Company has benefited from increased productivity driven by higher production volumes and reductions in direct manufacturing costs. In addition to the existing F1 and F2 production buildings, the F3 building commenced operations in 2023, followed by the opening of a new R&D building in January 2024.
As a manufacturing company, the accumulation of production activities generates (1) experience curve effects, (2) economies of scale driven by increased output, and (3) continuous automation. As a result, we expect operating profit growth to accelerate further as cosmetic ingredient revenue continues to increase.
Next, I would like to share our plans for further growth in 2024.
First, strengthening new product development for cosmetic ingredients
The Company will further strengthen its overseas sales network and sales activities, which have been steadily built over time. We continue to expand our portfolio of innovative cosmetic ingredients characterized as Global First and Global Only—more rapidly and in greater number than any other global competitor.
Second, strengthening cosmetic sales activities
In 2023, the Company continued to enhance both online and offline sales activities. Online efforts included the regular distribution of annual newsletters to 47,043 domestic and overseas contacts, while offline activities involved consistent participation in major domestic and international exhibitions.
Third, full-scale expansion of the cosmetic ODM business
Given the strong potential identified in the cosmetic ODM business entered in 2023, the Company plans to establish a new ODM factory in 2024. While revenue contributions from overseas customers and projects initiated in 2023 remain modest, growing customer interest and positive long-term revenue prospects have led us to pursue proactive investment.
In light of the global expansion of K-Beauty and the growing number of indie brands, the domestic ODM/OEM market is expected to expand. We plan to leverage the strengths of the Janghang plant, which received FDA certification for API manufacturing in 2019, to create synergies with our existing cosmetic ingredient business.
Fourth, entry into the bio cosmetic ingredient business
The Company plans to launch bio-based cosmetic ingredients in the first half of this year, utilizing synthetic bioengineering as the core technology. As consumers increasingly prefer plant-based (vegan) ingredients, we aim to replace animal-derived cosmetic materials with plant-based alternatives through synthetic biology.
Closing Remarks
Sunjin Beauty Science is a growth company. In 2023, five securities analyst reports covered the Company, matching the number issued in 2022. Considering the Company's size, this level of sustained attention from the investment community over two consecutive years is highly exceptional.
At this General Meeting of Shareholders, I would like to once again express my sincere gratitude to our shareholders for their trust and insight. We will continue to work diligently to reward your continued interest and support.
Thank you.
March 29, 2024
The 36th Annual General Meeting of Shareholders, Sunjin Beauty Science
CEO Sung Ho Lee
[Regional Revenue of Cosmetic Ingredients (Headquarters Basis)]
Establishment of Sunjin Beauty Science Italy Subsidiary
On July 1, 2022, the Company established its Italian subsidiary near Milan, one of the core clusters of the EU cosmetics industry. This marked the first case among Korean cosmetic ingredient companies to establish a subsidiary in Europe. Remarkably, the subsidiary achieved profitability within just six months of establishment.
[Establishment of Sunjin Beauty Science Italy Subsidiary]
Entry into the Cosmetic ODM Business
In 2022, the Company achieved strong growth in its cosmetic ingredient business and launched a new cosmetic ODM business. This initiative is rare even on a global scale. Differentiating from conventional ODM models, we aim to (1) specialize in FDA-compliant OTC ODM by leveraging our strengths as an FDA-certified cosmetic ingredient manufacturer, (2) utilize differentiated in-house ingredients to develop diverse formulations, and (3) showcase these products to our global ingredient customers as promotional tools for raw materials.
Through this strategy, we expect to create new revenue streams and establish differentiated competitiveness in the cosmetic ODM business.
Through this strategy, we expect to create new revenue streams and establish differentiated competitiveness in the cosmetic ODM business.
[OTC-Related Quality Meeting]
Relocation of the Seoul Headquarters
In August 2022, all departments excluding manufacturing—R&D, sales, and administration—were relocated to the 8th floor of Hanwha BizMetro 2 in Gasan-dong, Geumcheon-gu, Seoul. We are delighted to welcome our shareholders to the newly relocated Seoul headquarters. Sunjin Beauty Science continuously strives to provide the best possible working environment for its employees, and this relocation is part of that commitment.
[Seoul Headquarters Relocation Ceremony]
Sale of the Ansan Plant, Full Relocation to the Janghang Plant, and Start of F3 Construction
In 2022, operations at the Ansan plant were suspended and the facility was sold for KRW 25.785 billion. Beginning in August 2022, all production was fully consolidated at the Janghang plant.
Through full consolidation at the Janghang plant, the Company aims to improve profitability by enhancing production efficiency and reducing manufacturing costs, including utilities such as electricity and water.
Proceeds from the sale of the Ansan plant are planned to be used for debt repayment, corporate tax payments on capital gains, and additional factory investments totaling KRW 6.0 billion.
Through full consolidation at the Janghang plant, the Company aims to improve profitability by enhancing production efficiency and reducing manufacturing costs, including utilities such as electricity and water.
Proceeds from the sale of the Ansan plant are planned to be used for debt repayment, corporate tax payments on capital gains, and additional factory investments totaling KRW 6.0 billion.
[Janghang Plant Overview]
In August 2022, construction of the third factory began at the Janghang campus. With a total investment of KRW 7.0 billion, the F3 plant was scheduled for completion in March 2023. Unlike the first and second plants, which focus on mass production, the third plant is dedicated to pilot-scale production and will play a key role in producing future-focused products.
[Perspective View of the Janghang Campus Third Factory]
Beauty Care Platform Company — We Will Achieve Greater Dreams.
Beauty Care Platform Company — We Will Achieve Greater Dreams.
The first half of 2022 was extremely busy.
Following our KOSDAQ listing in 2021, we held our first General Meeting of Shareholders, sold the Ansan plant site, discontinued operations at the Ansan plant, fully consolidated production at the Janghang plant, and relocated our headquarters to the Gasan Digital Industrial Complex in Seoul in August.
Against this backdrop, I would like to share the Company's new vision.
First, in our core cosmetic ingredient business, we aim to become the No.1 company in Korea. More specifically, our goal is to become the world's leading manufacturer of silica for cosmetic ingredients and a global top-five sunscreen ingredient supplier. We target KRW 100 billion in revenue and USD 70 million in exports, and we do not believe it will take long to achieve these goals.
We will grow our new OTC ODM business.
We will firmly establish our new brand business. There is a well-known saying in the IT industry, often quoted by Steve Jobs:
"If you are really serious about software, you should make your own hardware." – Alan Kay
iRecipe is a brand (Hardware) created by experts in cosmetic ingredients (Software), a global hidden champion. Expanding from cosmetic ingredients into branding and ODM is a rare case even globally. Nevertheless, Sunjin Beauty Science is boldly pursuing a path no one has taken before—the Beauty Care Platform.
Sunjin Beauty Science will become a Beauty Care Platform Company.
Many companies attracting attention both domestically and globally today are platform-oriented businesses. Leveraging our strong brand recognition in the global B2B cosmetic ingredient market, we will strengthen not only the sales of our own manufactured ingredients but also cosmetic ingredient distribution as a platform.
August 2022
I revisited my previous CEO message, which I recall writing around 2012. Thanks to the support of our customers worldwide and the dedication of our employees, the Company has grown significantly over the years.
As a result, we became the 10th largest global manufacturer of sunscreen ingredients as of 2018.
This achievement was driven by continuous overseas market expansion, online marketing, and the launch of innovative products known as Global First & Only. In addition, the completion of the Janghang plant in June 2019 and the successful FDA inspection in September are expected to further elevate our global competitiveness.
To sustain this growth, we will focus on the following initiatives.
Strengthening Overseas Sales Activities
There is no shortcut in sales. We will further reinforce the overseas sales efforts we have consistently pursued.
Enhancing Online Marketing Activities
We plan to strengthen non-face-to-face sales by expanding YouTube-based educational and promotional content, increasing localized newsletter distribution, hosting more online seminars via Zoom, and leveraging big data for customized sales activities.
Strategic Utilization of the Janghang Plant
As the first facility in Asia (excluding Japan) to pass FDA inspection, the Janghang plant will be actively promoted as a strategic asset to global customers, with aggressive sales initiatives aimed at achieving early full-capacity utilization.
R&D Strategy
We will maintain a strong new product pipeline through innovative material development based on the convergence of diverse technologies, alongside expanded research into second-generation sunscreen ingredients and third-generation skincare materials.
We will continue striving to meet the expectations of our customers, employees, and shareholders. Thank you.
July 20, 2020 CEO Sung Ho Lee
Dreams
I Had a Dream
Sunjin Beauty Science is a company that manufactures chemical materials.
Japan is the world's strongest country in component materials. The Japanese chemical companies we compete with globally typically have R&D histories 20–30 years longer than ours, employ five to ten times more researchers, and are 10 to 200 times larger in scale.
Since joining Sunjin Beauty Science in 1999, I have worked diligently in R&D and overseas sales. However, the reality was daunting, and the belief that "anything is possible if you try" gradually changed to the realization that "even hard work does not guarantee success."
In 2007, about seven years into my R&D career, the Japanese yen fell sharply to KRW 750 per 100 yen. This erased even our last remaining advantage—price competitiveness—leaving me deeply discouraged. "The chemical materials industry is truly difficult…"
Toward the end of that year, I came across a New Year's calligraphy by Chairman Bae Sang-myeon, founder of Kooksoondang.
"一藝八年, 商業十年"
Its meaning was that mastering a single craft takes eight years, and turning it into a business takes ten.
"Had I truly devoted eight years to mastering a craft, and ten years to commercializing it?" This question struck me deeply.
I have a dream. To go beyond simply copying competitors' products and instead develop creative and innovative products that earn respect from customers and admiration from competitors.
Today, both I and Sunjin Beauty Science are more confident than before that this dream can become reality.
We will continue to work even harder. I believe that business success will follow naturally. Thank you.
