Kyungdong Pharmaceutical Spent A Lot On Models IU & Dex Despite In Deficit
It is known that Kyungdong Pharmaceutical modeled by IU is facing a crisis due to the big loss in operating profit recently
According to the business report of Kyungdong Pharmaceutical, the company recorded 162.6 billion won in annual sales last year. It’s a decline of 20 billion won from last year’s sales of 182.7 billion won.
The problem is the operating profit. The company’s profit decreased from 15.7 billion won in 2021 to 8.3 billion won in 2022. They ended up in deficit last year with an operating loss of 25 billion won. Due to the decrease in performance, the company went through restructuring and the number of employees, which was nearly 600 in 2022, fell to 400 within a year. Insiders said, “Restructuring is obvious when a company is facing a crisis but reducing a third of all employees indicates that the situation is not good at all”.
Amid the business’s alarming crisis, the CEO’s salary reportedly increased. CEO Ryu Ki-sung of Kyungdon Pharmaceutical received 820 million won in salary last year, 170 million won more than that of the previous year. In the case of other businesses like GC Green Cross and Ildong Pharmaceutical, their CEOs received lower annual salaries after undergoing restructuring due to poor performances.
Chairman Ryu Deok-hee founded the medium-sized pharmaceutical company Kyungdong Pharmaceutical in 1976. CEO Ryu Ki-sung, the eldest son of Chairman Ryu, joined the company in 2006 and became the vice chairman and CEO in 2014. After Chairman Ryu stepped down in 2021, Ryu Ki-sung is managing the company as a co-CEO with professional manager Kim Kyung-hoon.
Despite the bad situation, the company continued to spend a lot on advertising, raising doubts among netizens. Last year, singer IU extended her modeling contract with Kyungdong by two years. Known as a top artist, IU reportedly received 1 billion won in annual model fees. Apart from IU, Kyungdong recently introduced Dex, the YouTuber who recently appeared on many entertainment programs, as their new model. Since Dex is a rising star, the company must have paid a considerable amount to recruit him.
Source: daum
