TOKYO — Shiseido said its net income for the 12 months ended March 31 grew by nearly 30 percent, thanks to increased sales and extraordinary income associated with the sale of the Decléor and Carita brands to L’Oréal.
Shiseido’s yearly net profit increased 28.8 percent to 33.67 billion yen, or $306.38 million.
The company’s operating profit dropped 44.4 percent to 27.61 billion yen, or $251.3 million, on higher personnel, marketing and logistics expenses.
Yearly net sales grew by 2.1 percent to 777.69 billion yen, or $7.08 billion.
Dollar figures are calculated at average exchange for the 12-month period.
Shiseido’s domestic sales in its home market of Japan, which made up 47 percent of its total revenues, fell 3.1 percent to 365.62 billion yen, or $3.33 billion. Overseas sales increased 7.1 percent to 412.07 billion yen, or $3.75 billion. However, without the effect of currency translation, overseas sales would have fallen 0.9 percent.
Separately, Japan’s largest cosmetics company announced a new three-year plan that will take it from the current fiscal year through 2017.
At an analyst briefing in Tokyo on Monday, Shiseido’s representative director, president and chief executive officer Masahiko Uotani said that three of the company’s key strategies over the three-year period will be to build the foundation for obtaining the largest share of Japan’s cosmetics market, accelerate global growth and reengineer its business in China.
Shiseido will also increase investment in customer-focused marketing and research and development, while at the same time undertaking cost reforms in order to reduce its costs by up to 40 billion yen, or $334.33 million at current exchange rates, by the 2017 fiscal year.
Pending shareholder approval in June, Shiseido plans to change its fiscal year-end from March 31 to Dec. 31, and therefore its current fiscal year will be a nine-month transition period.
The company released its guidance for this period, with percentage-change figures based on adjusted numbers for the same nine-month period a year earlier.
Shiseido expects its net income to plummet 63.7 percent on unrealized profit and lower tax merits due to the shorter fiscal year. It is predicted a net profit of 10 billion yen, or $83.6 million.
The company predicts a 31.9 percent increase in operating profit, totaling 28 billion yen, or $234 million.
Shiseido forecasts its net sales will grow by 7.8 percent to 730 billion yen, or $6.1 billion.