Korea Cosmetic Association

Korea Cosmetic Association c KCA 2016

Korea Cosmetic Market ( 15) Production : 8.9704 trillion (korean won) (as of 2014) No. of Items : 101,362(as of 2014) No. of Manufacturers : 1,997 companies (as of 2015) No. of Marketing Authorization Holder : 6,465 companies (as of 2015) Export Import : 2912 million (USD) (131countries) : 1397 million (USD) (72countries) Scale of Market : About 18.4 trillion (korean won) Source : Korea Customs Service, Korea Pharmaceutical Traders Association, Korea Cosmetic Association c KCA 2016 2

Cosmetics Production 5 years( 10~ 14) 10,000 9,000 8,000 7,000 6,000 (Unit : Trillion KRW) 8,970 Annual growth rate(value) : 10.5% 7,972 7,122 6,385 6,014 Annaul growth rate(no.) : 5.4 % 5,000 5,371 4,000 3,000 4,353 4,487 4,479 4,603 2010 2011 2012 2013 2014 Annual growth rate(value) Annual growth rate(no.) Source : Korea Cosmetic Association c KCA 2016 3

Production by types of cosmetic( 10~ 14) Section Skin care preparations Product ion 2010 2011 2012 2013 2014 CAGR (compo Product ion Product ion Product ion (Unit : one hundred million KRW, %) Producti on 35,236 58.6 39,116 70.4 43,012 60.4 45,180 56.7 50,929 56.8 9.6 Make-up preparations 7,716 12.8 7,466 7.0 8,883 12.5 11,202 14.1 14,264 15.9 16.6 Hair preparations 9,267 15.4 9,772 10.4 10,555 14.8 12,227 15.3 13,047 14.5 8.9 und annual growth rate) Body cleansing products Eye makeup preparations 2,522 4.2 2,626 5.7 4,659 6.5 6,070 7.6 6,447 7.2 26.4 1,578 2.6 1,642 2.1 1,445 2.0 1,639 2.1 2,088 2.3 7.3 Shaving preparations 2,032 3.4 1,304 0.7 1,006 1.4 1,796 2.3 1,237 1.4-11.7 Products for finger nails and toe nails 330 0.5 366 1.4 508 0.7 641 0.8 583 0.6 15.3 Baby products 718 1.2 702 1.5 568 0.8 481 0.6 552 0.6-6.4 Fragrance preparations Hair coloring preparations 330 0.5 427 0.2 223 0.3 239 0.3 273 0.3-4.6 339 0.6 362 0.5 144 0.2 168 0.2 205 0.2-11.8 Bath preparations 72 0.1 55 0.1 192 0.3 48 0.1 46 0.1-10.6 Body deodorizers 5 0.01 17 0.03 32 0.05 30 0.0 32 0.0 59.1 Source : Korea Cosmetic Association Total 60,146 100.0 63,856 100.0 71,227 100.0 79,720 100.0 89,704 100.0 10.5 c KCA 2016 4

Production of Functional Cosmetic (Unit : one hundred million KRW, %) Section Produc tion 2010 2011 2012 2013 2014 Produc tion Produc tion Produc tion Produc tion CAGR Complex type Minimize the wrinkles Protect the skin from UV rays Whiten the skin tone 4,180 27.5 5,935 36.1 7,804 36.3 12,259 47.8 16,438 55.3 40.8 3,423 22.5 3,231 19.7 6,665 31.0 6,903 26.9 7,518 25.3 21.7 4,721 31.1 4,138 25.2 4,027 18.7 3,809 14.9 3,408 11.5-7.8 2,865 18.9 3,113 19.0 2,987 13.9 2,667 10.4 2,379 8.0-4.5 Total 15,189 100.0 16,418 100.0 21,483 100.0 25,638 100.0 29,744 100 18.3 Source : Korea Cosmetic Association c KCA 2016 5

Marketing Authorization Holder by production (Unit : company, %, one hundred million KRW) 2013 2014 Section Marketing Authorization Holder Production Marketing Authorization Holder Production Company Production Company Production More than 100 Billion KRW 8 0.3 59,040 74.1 11 0.4 67,695 75.5 50 Billion KRW ~ 100 Billion KRW 9 0.4 6,916 8.7 8 0.29 5,816 6.5 10 Billion KRW ~ 50 Billion KRW 29 1.2 5,134 6.4 29 1.06 6,222 6.9 5 Billion KRW ~ 10 Billion KRW 30 1.2 2,082 2.6 41 1.5 2,824 3.1 1 Billion KRW ~ 5 Billion KRW 180 7.4 3,878 4.9 204 7.46 4,341 4.8 Less than 1 Billion KRW 2,168 89.4 2,670 3.3 2,442 89.29 2,805 3.1 Total 2,424 100.0 79,720 100.0 2,735 100.0 89,703 100.0 Source : Korea Cosmetic Association c KCA 2016 6

Export & Import Export & Import by year (Unit : 1,000 USD) Year Export Import Export value YoY Import Value YoY The trade balance 2005 271,897 6.0 596,900 9.9-325,003 2006 289,448 6.5 693,399 16.2-403,951 2007 313,823 8.4 762,360 9.9-448,537 2008 383,076 22.1 860,287 12.8-477,211 2009 451,152 17.8 859,175-0.1-408,023 2010 791,399 75.4 1,032,429 20.2-241,030 2011 813,978 2.9 1,203,465 16.6-389,487 2012 977,866 20.1 1,239,181 3.0-261,315 2013 1,231,289 25.9 1,275,188 2.9-43,899 2014 1,873,570 52.2 1,386,355 8.7 487,215 2015 2,912,001 55.4 1,396,678 0.7 1,515,323 Source : Korea Customs Service c KCA 2016 7

Export & Import Export : 2912 million USD(2015) Import : 1397 million USD(2015) 3,500,000 Annual growth rate (import) : 3.8% 3,000,000 Annual growth rate (export) : 37.5% (Unit : 1,000 USD) 2,912,001 2,500,000 2,000,000 1,500,000 1,203,465 1,239,181 1,257,188 1,873,570 1,386,355 1,396,678 1,000,000 Balance 500,000 1,231,289 813,978 977,866-389,487-261,315-43,899 487,215 1,515,323 2011 2012 2013 2014 2015 Source : Korea Customs Service Import Export c KCA 2016 8

The scale of Export Value by state standards Scale of Export Value by state stadards (All sector) Ran king Country Export value($) 1 China 2.3 Trillion($) 2 United States 1.5 Trillion($) 3 Germany 1.3 Trillion($) 4 Japan 625 Billion ($) 5 Netherlands 567 Billion ($) 6 Korea 527 Billion ($) 7 Major 71 countries Source : World Trade Organization(WTO) 15 Trillion ($) Scale of Export Value by state stadards (Cosmetic sector) Ran king Country Export Value($) 1 France 10 Billion ($) 2 United States 8.6 Billion ($) 3 Germany 8 Billion ($) 4 United Kingdom 4.8 Billion ($) 5 Italy 4 Billion ($) 6 Korea 1.9 Billion ($) Source : Korea International Trade Association 30000 20000 10000 0 200 100 0 Export (All sector) Japan Germany United China Netherla Korea Export (Cosmetic sector) Korea Italy United Germany United France c KCA 2016 9

Major Exporters Major Exporters1 (UNIT : 1000 USD, %) Ranking 2014 2015 Country Export value Country Export value YoY 1 China 581,708 31.0 China 1,173,168 40.3 101.7 2 Hong kong 410,752 21.9 Hong Kong 687,574 23.6 67.4 3 United States 154,130 8.2 United States 238,156 8.2 54.5 4 Japan 144,727 7.7 Taiwan 139,415 4.8 11.4 5 Taiwan 125,201 6.7 Japan 137,794 4.7-4.8 6 Thailand 86,982 4.6 Thailand 93,335 3.2 7.3 7 Singapore 47,945 2.6 Singapore 65,747 2.3 37.1 8 Malaysia 44,941 2.4 Vietnam 53,698 1.8 22.3 9 Vietnam 43,896 2.3 Malaysia 48,009 1.6 6.8 10 Russian Federation 37,628 2.0 Source : Korea Customs Service(2015) Russian Federation 35,591 1.2-5.4 c KCA 2016 10

Major Exporters Major Exporters2 (UNIT : 1000USD, %) Ranking 2014 2015 Country Export value Country Export value YoY 11 Australia 29,634 1.6 Australia 31,590 1.1 6.6 12 Mongolia 13,291 0.7 France 14,477 0.5 158.8 13 Indonesia 12,489 0.7 Myanmar 13,247 0.5 86.4 14 Philippines 11,809 0.6 Indonesia 13,071 0.4 4.7 15 Canada 11,436 0.6 Philippines 13,008 0.4 10.2 16 Iran 8,113 0.4 Mongolia 11,217 0.4-15.6 17 Germany 7,843 0.4 Canada 11,115 0.4-2.8 18 United Arab Emirates 7,524 0.4 Kazakhstan 10,548 0.4 89.1 19 United Kingdom 7,287 0.4 Macau 9,658 0.3 44.6 20 Myanmar 7,108 0.4 Germany 9,082 0.3 15.8 Other 113 Countries 79,126 4.2 Other 111 countries 102,461 3.5 29.5 Total 133 Countries 1,873,570 100.0 Total 131 countries 2,912,001 100.0 55.4 Source : Korea Customs Service(2015) c KCA 2016 11

Major Exporters (UNIT : 1000USD, %) 1,400,000 1,200,000 1,000,000 800,000 600,000 400,000 200,000-2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 China Hongkong USA Japan Taiwan Thailand Singapore Malaysia Veitnam Russia Source : Korea Customs Service(2015) c KCA 2016 12

Major Importers Major Importers1 (UNIT : 1000USD, %) 2014 2015 Ranking Country Import value Country Import Value YoY 1 United States 449,760 32.4 United States 434,903 31.1-3.3 2 France 348,183 25.1 France 339,048 24.3-2.6 3 Japan 162,735 11.7 Japan 170,783 12.2 4.9 4 Italy 64,926 4.7 Italy 62,809 4.5-3.3 5 United Kingdom 61,587 4.4 United Kingdom 55,039 3.9-10.6 6 Thailand 46,849 3.4 Thailand 54,935 3.9 17.3 7 Germany 43,505 3.1 Germany 47,733 3.4 9.7 8 Canada 34,938 2.5 Canada 37,269 2.7 6.7 9 China 28,777 2.1 China 31,599 2.3 9.8 10 Sweden 21,793 1.6 Ireland 26,397 1.9 50.8 Source : Korea Customs Service(2015) c KCA 2016 13

Major Importers Major Importers2 (UNIT : 1000USD, %) Rangking Country 2014 2015 Import Value Country Import value YoY 11 Ireland 17,509 1.3 Spain 17,848 1.3 13.0 12 Spain 15,789 1.1 Sweden 17,679 1.3-18.9 13 Isreal 15,306 1.1 Switzerland 16,887 1.2 12.7 14 Switzerland 14,990 1.1 Isreal 16,130 1.2 5.4 15 Belgium 10,915 0.8 Belgium 13,041 0.9 19.5 16 Australia 9,821 0.7 Australia 10,172 0.7 3.6 17 Hong Kong 4,847 0.3 India 6,642 0.5 103.5 18 Netherlands 4,363 0.3 Hong Kong 5,559 0.4 14.7 19 Malaysia 4,258 0.3 Malaysia 5,477 0.4 28.6 20 Taiwan 3,557 0.3 Taiwan 4,069 0.3 14.4 Other 56 countries 21,947 1.6 Other 52 countries 22,644 1.6 3.2 Total 76 Source : Korea Customs Service(2015) 1,386,355 100.0 countries Total 72 countries 1,396,678 100 0.7 c KCA 2016 14

Major Importers (UNIT : 1000USD, %) 500,000 450,000 400,000 350,000 300,000 250,000 200,000 150,000 100,000 50,000-2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 USA France Japan Italy UK Thailand Germany Canada China Source : Korea Customs Service(2015) c KCA 2016 15

The World s Top 100 Cosmetic Company(2014) (unit : million dollars, %) ranking Company Country sales YoY 1 L ORÉAL FRANCE 29,940 14.4 1.8 2 UNILEVER UK 21,660 10.4 1.5 3 PROCTER & GAMBLE CO. USA 19,800 9.5-3.4 4 THE ESTÉE LAUDER COS USA 10,950 5.3 5.4 5 SHISEIDO CO. JAPAN 7,370 3.6 1.9 6 BEIERSDOFF GERMANY 6,590 3.2 2.3 7 AVON PRODUCTS USA 6,300 3.0-12.0 8 CHANEL France 6,210 3.0 6.0 9 JOHNSON & JOHNSON USA 6,000 2.9-0.1 10 KAO CORP. JAPAN 5,600 2.7 3.4 14 AMOREPACIFIC CORP. KOREA 4,470 2.2 21.2 20 LG HOUSEHOLD & HEALTH CARE KOREA 2,300 1.1 18.0 42 SHANGHAI JAHWA UNITED CO. CHINA 720.8 0.3 11.4 57 ABLE C&C KOREA 438 0.2-1.0 63 JALA GROUP CHINA 346.6 0.2 14.2 66 JIANGSU LONGRICH GROUP CO. CHINA 327.0 0.2 6.4 99 GUANGDONG MARUBI BIOTECHNOLOGY CO. CHINA 175.7 0.1 10.5 TOTAL (100 countries) 207,425 100.0 1.4 Source : WWD(2015) c KCA 2016 16

c KCA 2016 17