Homeplus Submits Revised Rehabilitation Plan, Aiming for 150 Billion Won Profit in Three Years

Homeplus announced on June 29 that it has submitted a revised rehabilitation plan to the Seoul Bankruptcy Court.

The company entered rehabilitation proceedings in March of last year and has since been restructuring its stores and business operations. Homeplus has reduced its number of large stores from 126 to 67 core locations and negotiated rent adjustments with landlords. Additionally, it sold its supermarket division, Homeplus Express, to NS Shopping, a subsidiary of Harim Group.

The company claims these efforts have significantly improved its cost structure. Homeplus stated, "We have reduced our workforce by about 50% through voluntary retirements, and various costs have decreased by approximately 1.2 trillion won compared to before the rehabilitation application."

Homeplus believes that if product supply and operations normalize, it can recover its sales. The company stated, "The 67 core stores can achieve an operating profit of around 80 billion won once supply and operations are normalized, and this could increase to 150 billion won within three years."

The revised rehabilitation plan reflects these anticipated improvements in business performance. Homeplus plans to fully repay both public and rehabilitation creditors using profits from its turnaround and proceeds from the sale of real estate from closed stores.

However, the implementation of the rehabilitation plan is contingent on securing 200 billion won needed for wages, product payments, and restructuring. The deadline for the approval of Homeplus's rehabilitation plan is July 3.