TOKYO — Kao Corp. said Monday that its net income for the three months ended June 30 grew 21.7 percent compared with the same period last year, despite rising costs of raw materials and an extraordinary loss related to the March earthquake of 1 billion yen, or $12.26 million at average exchange rates for the period.
Kao recorded a net income of 15.18 billion yen, or $186.14 million at an exchange rate provided by the company. Operating income rose 11.7 percent to 29.25 billion yen, or $358.54 million.
“Net sales, which had been forecast to decrease due to the impact of the [earthquake], increased 1.7 percent compared with the same quarter a year earlier,” the company said in a release. Kao attributed the rise to “a faster-than-expected market recovery, the restoration of the supply chain, and other factors.” Sales totaled 294.94 billion yen, or $3.62 billion.
Net sales of Kao’s beauty care segment, which includes brands such as Kanebo, Molton Brown, Bioré and Jergens, fell 0.5 percent to 130.7 billion yen, or $1.60 billion. Regarding this sector, the company said, “new products performed well in North America and Europe, but sales were impacted by the contraction of the cosmetics market in Japan.”
Because of its unexpectedly strong performance in the fiscal first quarter, Kao has revised upwards its earnings forecasts for the six months ending September 30. Net income is now expected to grow 15 percent to 32 billion yen, or $407.35 million at current exchange. Operating income is forecast to increase by 0.2 percent to 58 billion yen, or $738.31 million. Sales are expected to total 620 billion yen, or $7.89 billion, an increase of 3.1 percent.