South Korean cosmetics company Skinfood has filed for court receivership due to ongoing financial problems, according to a report by the Korean Herald.
Skinfood has amassed mounting losses, which the company has attributed to a sales slow down as well as accumulated debts, and as a result has filed for a court-led restructuring scheme.
A company official stated, “We are having temporary difficulty in securing liquidity due to excessive debt.
“We sought the court restructuring as we thought settling the debt and promptly normalizing management will benefit everyone, including the creditors.”
The company is thought to have felt the effects of the ongoing tension between Seoul and Beijing leading to a fall in tourism in South Korea, as well as an outbreak of Middle East Respiratory Syndrome (MERS) in 2015.
Skinfood is said to be focusing on online channels in order to boost sales, with speculation mounting that the company will begin closing stores due to stock shortages.