SEOUL (Reuters) – U.S. e-cigarette maker Juul Labs said on Wednesday it would end operations in South Korea, a year after it entered the market there but failed to gain traction amid government health warnings.

In a statement, the company said since the beginning of the year it had entered a restructuring process aimed a re-establishing a viable business in South Korea by significantly reducing costs and making changes to its products.

“However, these innovations will not be available as anticipated,” the statement said. “As a result, we intend to cease our operations in South Korea.”

In October last year, South Korea’s health ministry advised people to stop vaping because of growing health concerns, especially after a case of pneumonia was reported in a 30-year-old e-cigarette user that month.

The announcement prompted convenience store chains and duty free shops to suspend the sale of flavoured liquid e-cigarettes, including those made by Juul Labs.

In December, South Korean health authorities said they had found vitamin E acetate, which may be linked to lung illnesses, in some liquid e-cigarette products made by Juul Labs, but the company denied using the material.

Juul Labs launched a product portfolio that was specifically developed for the Korean market in May 2019, but “our performance has not met expectations in terms of meeting the needs of our Korean adult smokers to successfully transition from combustible cigarettes,” the company statement said.

“We have learned through this process and are focused on innovating our product portfolio,” the company said, noting it was committed to working with South Korean health authorities.

(Reporting by Sangmi Cha and Josh Smith, editing by Louise Heavens)