Shiseido Sets Records for Sales, Earnings in First Half TOKYO — Shiseido Group announced record sales and net profits for the first half, attributing the results to strong marketing and restructuring initiatives.
On a consolidated basis, net profits skyrocketed 115.3 percent to 10.3 billion yen, or $93.3 million at average exchange, for the half ended Sept. 30, compared with the year-ago period.
"Despite reporting an extraordinary loss related to the mandatory introduction of impairment accounting, interim net income jumped," the Japanese cosmetics giant stated.
Sales were up 4.6 percent to 330.5 billion yen, or $3 billion, over last year. Meanwhile, domestic sales were up 2.5 percent and overseas sales, which made up 27.6 percent of the total business, grew 10.4 percent. Sales from cosmetics, which made up 78.8 percent of total sales, increased 4.3 percent. Domestic sales of cosmetics rose 1.5 percent.
As for overseas cosmetics, sales grew 10 percent in local currencies and 11.3 percent on a yen-denominated basis. During the period, Shiseido's cosmetics business benefited from increased sales in all regions, led by China. "Sales of our mainstay Shiseido brand were solid, as were fragrances sold by Beauté Prestige International S.A., together with non-Shiseido brands, notably Nars and Decléor," said the group.
Sales in China, including Hong Kong, rose 36 percent in local currencies and 33 percent on a yen basis. In China, Shiseido's products were carried in 777 specialty stores at the end of September, a number the company projects to reach 1,000, by yearend. Sales in Asia and Oceania jumped 18.4 percent in local currencies and 19.7 percent on a yen basis to 31.4 billion yen, or $284.5 million.
Sales in Europe were up 4.1 percent in local currencies and 6.2 percent on a yen basis to 37.7 billion yen, or $341.6 million. In the Americas, including the U.S., Canada and Brazil, sales increased 7.2 percent in local currencies and 5.7 percent on a yen basis to 22.3 billion yen, or $202 million, compared with the same period a year earlier. — Koji Hirano
Avon 3Q Net Beats Estimates NEW YORK — Although Avon Products Inc. reported a 5 percent decline in third-quarter earnings per share as it experienced softness in its beauty, skin care and color businesses, the company managed to beat analysts' estimates by six cents.Net income for the quarter ended Sept. 30 dropped 7.4 percent to $163.8 million, or 35 cents a diluted share, from $176.9 million, or 37 cents, in the same period last year. Analysts had the company pegged to earn 29 cents. Sales in the quarter fell 4.5 percent to $1.87 billion from $1.78 billion a year ago.
"After five years of strong market performance, clearly the business dynamic has changed on us dramatically," said Andrea Jung, Avon's chief executive officer, on a conference call. "We are now operating with a new set of macrorealities. At the same time, there are a number of company-specific issues that are also compounding our results and these problems are very fixable, but they will take time."
Jung said the company's product pipeline and investments were not strong or deep enough this year to keep up with competitors, but that Avon has long-term structural and process-oriented changes under way to improve operations.
By market, the U.S. was Avon's weakest performer this quarter. In the U.S., the company faces decreased customer purchase frequency and competition from other beauty companies as well as the impact of increased fuel costs on sales representatives and their customers, the company said.
Regarding the Chinese market, the company attributes a 16 percent decline in revenue to the reduction in sales by Beauty Boutique owners concerned with direct selling. Though companies such as Avon can apply for direct-selling licenses beginning Dec. 1, direct selling may not launch for some time afterward.
"We're encouraged that the regulatory framework is taking shape and this will provide us with the necessary context in order to successfully launch direct selling and support our Beauty Boutique owners," said Jung.
The company forecasts full-year 2005 revenues increasing in the low- to midsingle digits, up slightly in local currencies. — Amy S. Choi
EXCLUSIVE: Two and half months after John Targon, cofounder and codesigner of Baja East, was hired as creative director of the contemporary division at Marc Jacobs, he has left the company, WWD has learned. Marc Jacobs International, which is owned by LVMH Moët Hennessy Louis Vuitton, confirmed Targon’s departure in a statement: “John Targon is a talented designer and we appreciate the work he has done here. Ultimately working together did not make sense for the brand and we wish him the best.” Read the story by @jessiredale, link in bio. #wwdnews
@theluxurycollection is officially launching a collection, tapping Sofia Sanchez de Betak for the capsule. Over 30 styles will be featured in the Chufy x The Luxury Collection, debuting next month at Bergdorf Goodman, The Webster, FiveStory and more. De Betak, known as “@chufy,” drew inspiration for the collection from her trips to Japan in the past year #wwdfashion
@lhd, founder and CEO of @thewebster, has teamed up with @lebonmarcherivegauche for the European launch of her ready-to-wear line, LHD. The launch will come with an exclusive pop-up opening today that’s set to run through May 20. Located on the second floor, it carries her debut Miami-themed resort collection, launched in November as see-now-buy-now. #wwdfashion
@longchamp, which marks its 70th anniversary this year, just opened its biggest U.S. store on Manhattan’s Fifth Avenue. On the lower level there’s a floor-to-ceiling display of the brand’s iconic Le Pliage bag – in all of its different colors, shapes and sizes. Customers can also have their product personalized in-store by imprinting names, initials or emblems. #wwdfashion (📷: @ericmtownsend)
“Whenever I’m in that place of sound and music, I don’t have fear or nervousness…This album has a lot of themes of courage and boldness and I want to be the soundtrack for people’s lives. I’ll be so happy if [my songs] evoke strength in people, which I know music has done for me,” says @kimbramusic of her newest album “Primal Heart.” The New Zealand-born singer sat down with WWD to talk about her music, newest tour and connecting with hear fans — read more on WWD.com #wwdeye (📷: @jilliansollazzo)
Luxury handbag resale company @rebagofficial is planning to sell a rare collectible for $70,000: the @hermes White Crocodile Himalayan Birkin. The exclusive Birkin sold for about $100,000 in 2008, when @davidbeckham bought one for his wife @victoriabeckham to add to her collection. Read more about the rare Birkin on WWD.com #wwdaccessories
With her costume pearl necklace and what-you-see-is-what-you-get style, Barbara Bush, who died Tuesday at age 92, was a straight-shooter from start to finish.
Born Barbara Pierce in New York City, Bush served as the 37th first lady, as well as the country’s second lady from 1981 to 1989. In addition to being part of the longest presidential marriage — 73 years — Bush also had the unlikely distinction of having one son, George W., become the 43rd president and another son, Jeb, run unsuccessfully in 2016. Having served as second lady during the Reagan administration’s two terms and lived all over the world during her own husband’s ascending political career, Barbara Bush made it clear that literacy — not fashion — was her priority. Read more from Rosemary Feitelberg’s obituary on the late First Lady in WWD.com, link in bio. #barbarabush #wwdnews
Western and ’90s trends have influenced denim for fall 2018. Think raw, dark and coated jeans mixed with bold prints and tough leather. #trendtuesdays #wwdfashion (Styled by @thealexbadia;📷: @ryanplett)