TOKYO –Shiseido Group saw higher profits but slightly slower sales for the first half of the year.
Net profit rose 55.3 percent to 20.1 billion yen, or $189.54 million for the six months ended Sept. 30. Sales slid one percent to 359.4 billion yen, or $3.39 billion. Dollar figures have been converted from the yen at average exchange rates for the period to which they refer.
Proportionally lower costs and a lower tax rate helped boost the beauty giant’s bottom line. Shiseido said it benefited from a change in its product mix and a move to shift some of its expenses to the third quarter and beyond.
Shiseido confirmed its full-year profit targets but cut its sales forecast, warning that market conditions are deteriorating. The company forecasts a 1.5 percent gain in net income to 36 billion yen, or $369.8 million, and a 2.4 percent rise in operating income to 65 billion yen, or $667.7 million. Sales are now seen declining 0.5 percent to 720 billion yen, or $7.4 billion dollars. The original forecast was for sales to come in at 730 billion yen, or $7.5 billion.
“During the term, both Japanese and overseas economies showed clear signs of retreat, while conditions surrounding markets for consumable goods became more difficult,” the group said in a statement.
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First –half operating profit rose 5.6 percent to 33.9 billion yen, or $319.68 million despite some extraordinary losses including business restructuring and impairment expenses related to its withdrawal from the boutique business and the liquidation of its retail subsidiary Shiseido Beautech Co., Ltd.