TOKYO — Shiseido saw double-digit jumps in sales and profits for the first quarter of the year on the back of strong business both in Japan and internationally.
The Japanese beauty giant said its net profit for the three months ended June 30 totaled 3.68 billion yen, or $30.15 million at average exchange rates for the period. In the same fiscal first quarter last year, the company posted a loss of 1.78 billion yen, or $17.43 million.
The company’s operating income grew by over nine times to 13.05 billion yen, or $106.98 million, owing to higher sales. But Shiseido said that tax expenses increased, cutting into its bottom line.
Shiseido’s net sales also showed double-digit growth, up 20.2 percent year-on-year to 202.31 billion yen, or $1.66 billion.
The company, which earlier this year tapped Lady Gaga for TV commercials in Japan, said the Japanese cosmetics market showed a continued, gradual recovery, thanks in part to a rise in demand from overseas visitors to Japan. Sales at Shiseido’s Japan business rose 15 percent to 82.6 billion yen, or $677.32 million.
“In addition to a rebound from the slump in the first quarter of the previous year, when sales were sluggish in reaction to the consumption tax hike, we began seeing some success in brand innovation initiatives ongoing from the previous fiscal year, and growing inbound sales contributed,” the company said.
Sales in Shiseido’s global business increased by 22.9 percent, or 13.6 percent in local currency terms. Those sales totaled 113.81 billion, or $933.21 million. Sales of Nars and Bare Minerals were strong in the Americas, while fragrances performed well in Europe, Shiseido said.
As it changes its fiscal year end from Mar. 31 to Dec. 31, Shiseido’s current fiscal year is a nine-month interim period, ending Dec. 31. The company’s guidance for this period is based on adjusted nine-month figures from the previous year.
Shiseido raised its previously released outlook for its nine-month profit and sales figures. It now expects net profit to fall 60 percent to 11 billion yen, or $89.62 million at current exchange rates, up from a previous forecast of 10 billion yen, or $81.46 million.
The company raised its operating profit guidance to 30 billion yen, or $244.41 million, up from 28 billion yen, or $228.12 million. This new forecast represents yearly growth of 41.3 percent.
Shiseido is predicting sales growth of 12.9 percent to 765 billion yen, or $6.23 billion. Its previous outlook was for sales of 730 billion yen, or $5.95 billion.
Shiseido chief executive officer Masahiko Uotani is engineering a revamp of the storied Japanese firm. Earlier this week Shiseido announced that it had hired former Coty exec Marc Rey to become president and ceo of Shiseido Americas and the global head of Nars and Bare Escentuals. Longtime Shiseido Cosmetics America ceo Heidi Manheimer is leaving the company at the end of September.