TOKYO — Shiseido Co., Ltd. narrowed its losses in the firstquarter as it warned that its first-half net profit will come in lowerthan originally forecast due to tax expenses.
The Japanesebeauty company said Friday that net losses for the three months endedJune 30 came in at 277 million yen, or $3.4 million, compared to ayear-earlier loss of 666 million yen, or $7.2 million. All dollars areconverted from the yen at average exchange rates for the period to whichthey refer.
Sales for the period grew 7.9 percent to 157.29billion yen, or $1.93 billion. Once again, the company’s internationalbusiness outperformed its domestic one. International revenue grew 15.8percent to 67.7 billion, or $829.3 million, while that in Japan advanced2.6 percent to 89.6 billion yen, or $1.1 billion.
First-quarteroperating profit more than doubled to 9.06 billion yen, or $111million.
Shiseido said the March 11 earthquake and the ensuingproblems at the Fukushima nuclear plant hampered business in its homemarket of Japan but its distribution operations resumed their normalactivity as early as April.
The cosmetics market in westerncountries maintained a “recovery tone” and sales in China and otheremerging markets continued to climb.
Carsten Fischer, Shiseido’scorporate senior executive officer responsible for internationalbusiness, has spearheaded the company’s global push, particularly inChina and in the U.S. through the acquisition of Bare Escentuals. He isalso shaping up to be one of the best-paid executives in Japan. Fischermade 443 million yen, or $5.2 million, for the fiscal year ended March31 in terms of his salary, bonuses and stock options, according toShiseido’s recently released annual report. He took home 141 millionyen, or $1.52 million, the previous year.
The company trimmedits net profit forecast for the six months ending Sept. 30, stating thatits tax expenses will be higher than originally expected. It now seesits first-half net profit coming in at 7 billion yen, or $89.9 million,compared to an earlier forecast of 10 billion yen, or $128.5 million. Italso raised its sales forecast to 336 billion yen, or $4.32 billion,from 334 billion yen, or $4.29 billion, citing the depreciation of theyen against the company’s expectations.
Shiseido left itsfull-year forecasts untouched. It said it expects net profit to grow64.2 percent to 21 billion yen, or $269.8 million, and net sales toadvance 1.4 percent to 680 billion yen, or $8.74 billion.
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