Hanwha’s Third Son Kim Dong-seon Doubles Down on Department Stores and Food Tech After Burger Venture

[Korea Financial Times, Park seulgi] Five Guys was the first real test of management for Kim Dong-seon, Executive Vice President of Hanwha Galleria.

After stepping into management in 2023, the Five Guys business was the first project Kim spearheaded, participating directly in everything from initial planning to contract signing. Now, two years later, Kim is pursuing a sale of the Five Guys business.

Having delivered positive results and boosted its valuation, Five Guys is being put up for sale. The strategy reflects Kim’s judgment that it is smarter to divest now and strengthen the core business portfolio, including department stores. As a result, his next management test will likely lie in the core department store operations and foodtech.
According to industry sources on the 3rd, Hanwha Galleria is reviewing a sale of its domestic franchise rights for the US burger brand Five Guys. “We are currently reviewing and considering the sale, but nothing has been finalized yet,” the company said. “The decision will be made in the direction that is most beneficial for the company and shareholders, considering various factors.”

Five Guys was one of the first businesses led by Kim Dong-seon following Hanwha Galleria’s split-off from Hanwha Solutions in 2023. In its first year (May–December 2023), sales were KRW 10 billion with an operating loss of KRW 1.3 billion. In 2024, the business delivered a turnaround, posting KRW 46.5 billion in sales, KRW 3.4 billion in operating profit, and KRW 2 billion in net income.

Additionally, within just one year of launching in Korea, four Five Guys stores were ranked among the brand’s global top 10, attracting attention on the international stage.

Thus, Five Guys has been regarded as Kim’s first notable achievement as a manager. Nevertheless, the company is seeking a sale to realize the current high valuation and to refocus the business portfolio on its core areas.

Currently, Hanwha Galleria is pushing ahead with the reconstruction of its Apgujeong luxury department store in Seoul’s Gangnam district. The Luxurious Store, which consists of West (built in 1979) and East (built in 1985) wings, is now aging and outdated.
Hanwha Galleria is preparing a complete tear-down and redevelopment, planning to build new underground spaces and more than double the store’s operational space.

Given the scale, industry insiders estimate that the cost for Apgujeong’s luxury department store redevelopment will exceed KRW 1 trillion.

Hanwha Galleria’s performance has steadily declined since Kim Dong-seon assumed his role as executive vice president. In 2023, the company recorded sales of KRW 434.5 billion, operating profit of KRW 9.8 billion, and a net loss of KRW 30.1 billion. These results do not include January and February, as the company was spun off from Hanwha Solutions in March. In 2024, sales increased by 23.9% to KRW 538.3 billion, but operating profit fell sharply by 68% to KRW 3.1 billion.

Hanwha Galleria’s results have continued to decline under Kim’s leadership. For 2023, the division recorded sales of KRW 434.5 billion, operating profit of KRW 9.8 billion, and net loss of KRW 30.1 billion (figures exclude January–February after the split-off from Hanwha Solutions). In 2024, sales grew 23.9% to KRW 538.3 billion, but operating profit fell 68% to KRW 3.1 billion.

Food and beverage (F&B) businesses have gradually accounted for a greater share of overall sales. As of December 2023, department stores were 97.8% of total revenue and F&B was just 2.2%. By the following year, the department store share fell to 89.0% and F&B rose to 11.0%.

A company representative said, “If the sale of Five Guys goes ahead, it is expected to contribute to strengthening the business portfolio through new growth engines, and reinforce the competitiveness of the department store business, including the reconstruction of the Apgujeong flagship.”

At the same time, foodtech, another business Kim is focusing on, is emerging as a key metric for evaluating his management skills. Kim is accelerating foodtech business development, opening robot-powered udon, pasta, and pizza restaurants as well as unmanned cafés using collaborative robots.

As part of this, he is also working on creating synergies in foodtech with Ourhome, a large-scale institutional foodservice business that Hanwha acquired in May this year for KRW 869.5 billion.

At the ‘Ourhome Vision 2030’ event, Kim Dong-seon announced plans to expand food businesses incorporating advanced kitchen automation technologies from affiliates such as Hanwha Robotics and Hanwha Foodtech.

In particular, Hanwha’s acquisition of Ourhome has been recognized in the industry as a major deal, and as such, Executive Vice President Kim faces significant pressure to ensure a smooth transition.

In the first half of this year, Ourhome’s food service revenue rose 22% year-on-year, while concession sales at airports, major hospitals, and shopping malls increased by 28%.

However, these results were achieved under the previous owner, Chairperson Koo Mi-hyun, prior to the Hanwha acquisition. Accordingly, Kim’s leadership will be judged more fully based on Ourhome’s performance in the second half of the year.

An industry insider commented, “Selling Five Guys was probably not an easy decision, but with so many ventures underway, it seems the intention is to exit while the business is still performing well. With the costly acquisition of Ourhome, the push into foodtech as a future growth driver, and the reconstruction of the Galleria luxury department store, there is a mountain of work ahead—putting considerable pressure on Executive Vice President Kim to deliver results.”

Park seulgi (seulgi@fntimes.com)