LONDON — The Body Shop International plc reported Thursday first-half operating profits down 9 percent compared with the same period in 2004, but said it’s on track to achieve growth of 17 to 22 percent for the full year.
Operating profits came in at 8.9 million pounds, or $16.4 million, in the six-month period ended Aug. 27. Results were in line with forecasts, the company said in a statement. Dollar figures have been converted from the pound at the average exchange rate.
“The recent acquisitions of previously franchised markets in Canada, Hong Kong and Benelux have resulted in an increased seasonal profit bias toward the second half of the year, as the income flows from these markets have moved from wholesale sales in the first six months to retail sales in the second half of the year,” said Peter Saunders, the beauty retailer’s chief executive officer, in the statement.
Pretax profits for the first half were down 13 percent year-on-year to 7.1 million pounds, or $13.1 million. Earnings per share dipped 21.9 percent to 2.5 pence, or 4.6 cents.
Retail sales, which include turnover from wholly owned and franchised doors, plus the chain’s The Body Shop at Home direct selling business and Internet sales, were up 7 percent in the period to 327.4 million pounds, or $604.2 million. Comparable store sales were up 4 percent, while The Body Shop at Home business grew 10 percent.
By region, retail sales were up 4 percent in the Americas, 11 percent in Asia Pacific, 8 percent in Europe, the Middle East and Africa and 3 percent in the U.K. and Ireland.
The Body Shop added 40 stores in the half, bringing its total door count to 2,085 in 53 countries. About 120 new openings are scheduled for the full year.
The firm is “in active discussions” about introducing the chain in India, Saunders said in the statement. As reported, The Body Shop recently announced it will enter Russia, with its first door set to open in Moscow in December, to be followed by seven additional openings in the country next year.
Its U.S. Internet business, launched in September 2004, is set to make a small profit and will begin selling online in the U.K. next year.