[
THE INVESTOR] Lotte Group’s food and dining division Lotteria reported a 145.5 billion won (US$128.81 million) balance of debt guarantees for its overseas operations, according to the data released by Financial Supervisory Service on Oct. 25.
On the previous day, Lotteria decided to guarantee a 20.5 billion won loan of its subsidiary Burger King Japan and Burger King Japan Holdings, an 11.2 billion won loan of Lotteria Vietnam, and 6.8 billion won loan of Lotteria Beijing.
In addition to its flagship namesake fast-food chain, it also oversees Angel-in-us Coffee, Krispy Kreme, TGIF and Natuur, but its performance is spiraling down. It posted 1.8 billion won operating loss in 2015 turning to red from 32.1 billion won operating profit in 2014, and 38.7 billion won in 2013.
This mainly comes from the lackluster results overseas. The wholly owned subsidiary of the South Korean conglomerate has aggressively expanded overseas since 2009 but most of its operations are in red, and the amount of losses have only grown last year.
As part of a grand scheme, Lotte Group is seeking to list the major subsidiary, and “instead of direct investment, we are coming up with strategies to partner with local companies to improve profitability,” said an official at Lotteria.
By Hwang You-mee (
glamazon@heraldcorp.com)
