Japanese beauty giant Shiseido said net sales in the first three months of fiscal year 2023 increased 2.6 percent year-on-year to JPY 240 billion (USD 1.75 billion), on the back of growth in its Japan and Asia-Pacific markets.
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The Tokyo-based company said =net sales on a like-for-like basis decreased year-on-year in the China business, which was affected by the re-expansion of Covid infection cases in January, and in the travel retail business which was affected by retailer inventory adjustments.
Meanwhile, Shiseido clocked steadfast growth in its Japan business through enhancing the launch of new products and “capturing” the market recovery, while also achieving strong growth in the Americas, EMEA, and Asia-Pacific businesses.
“In the first three months of the fiscal year 2023, while uncertainty continued such as the prolonged conflict in Ukraine and rising prices, as a whole, the transition to post-pandemic new normal and the normalization of economic activities progressed and personal consumption showed signs of improvement,” said the company in press release.
“Japan’s domestic cosmetics market, while consumers became increasingly budget-conscious due to heightened living expenses, steadily recovered thanks to changes in the government’s Covid-19 basic response policy, including leaving mask use to personal discretion as well as increased opportunities to go out of home. In terms of overseas cosmetics markets, the market environment in China was difficult, affected by the re-expansion of infection cases after the lifting of zero-Covid policy by the government, however, the market situation bottomed out in January and has turned to be on a recovery trend since February. In the Europe and Americas regions, consumption continued to recover and the cosmetics market likewise showed strong growth across all categories.”
Core operating profit increased by JPY 8.2 billion year on year to JPY 12.5 billion, thanks to higher sales and continued cost management.
Profit attributable to owners of parent increased by JPY 4.3 billion year on year to JPY 8.7 billion, primarily due to an increase in core operating profit despite the recording of impairment losses and the structural reform expenses associated with the conclusion of agreement to transfer manufacturing operations of personal care products.
The EBITDA margin was 10.4 percent during the three months.