TOKYO — Shiseido’s net income for its fiscal first quarter fell by more than 48 percent due to a high comparative base in the same prior-year period, which was boosted by one-time gains on a transfer of intellectual property rights and the sale of land at a former factory site, the company said Friday.
For the three months ended March 31, Japan’s largest cosmetics company recorded a net profit of 14 billion yen, or $123.1 million, down 48.7 percent versus first-quarter 2016.
The company’s operating income rose 9.3 percent to 24.13 billion yen, or $212.1 million.
Shiseido said its first-quarter net sales gained 9 percent on the year to 232.46 billion yen, or $2.04 billion. Sales increased across each of the company’s business segments. Excluding the effects of currency translation, net sales climbed 10.7 percent.
“The Japan, China and travel-retail businesses, where the company actively undertook borderless marketing with a focus on Chinese customers, in particular drove growth,” the company said in a release. “Sales were also boosted by contributions from newly added brands.”
The biggest sales growth came from Shiseido’s travel-retail business, where sales jumped 77.8 percent on the year to 10.96 billion yen, or $96.3 million. Shiseido also saw double-digit sales gains in the European and Middle Eastern market, in China and in the Asia-Pacific region.
In the Americas, sales increased 4.9 percent on a local-currency basis, or 3.4 percent when converted to Japanese yen, totaling 31.07 billion yen, or $273.1 million.
Dollar figures are converted at average exchange for the period to which they refer.
“While operations were impacted by intense competition, a slowdown in the rate of market growth and issues relating to the supply chain, Laura Mercier, which was acquired during the previous year, contributed to results,” the company said.
Shiseido left unchanged its guidance for this fiscal year, when net income is expected to fall 19 percent to 26 billion yen, or $231.1 million at current exchange. The company predicts operating income will increase 23.7 percent to 45.5 billion yen, or $404.5 million. It forecasts sales growth of 10.5 percent to 940 billion yen, or $8.36 billion.
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