Shiseido cuts outlook as prolonged pandemic hits cosmetics sales
10/11/2020 06:52
TOKYO, Nov 10 (Reuters) - Shiseido Co Ltd 4911.T on
Tuesday lowered its full-year outlook and said consumer
sentiment had remained more cautious than the Japanese cometics
maker expected, as the global pandemic continued to weigh on
sales.
"The downturn in Japanese consumer sentiment has been geater
than we expected. In western markets, the increasing trend in
coronavirus cases has meant more restrictions of movement," it
said in a statement.
Like other companies in the luxury sector, Shiseido was hit
hard by coronavirus lockdowns earlier this year as department
stores and airport retailers shut down. A halt in tourism has
been particularly painful as the company depended heavily on
Chinese visitors.
The company said it expects a net loss of 30 billion yen
($285.69 million) for the full calendar year, worse than its
previous loss forecast for 22 billion yen.
Shiseido said it was aiming to cut costs to minimise
operating losses, but needed to spend money on clearing
inventory in Japan and restructuring its U.S. business.
Sales in Japan, its key market with a 35% share of its
business, fell 32% year-on-year in the nine months ended
September.
But in China, its second-biggest market, the decline was far
more moderate at 2% and the company said it was seeing a
recovery there.
"In China, most retailers have resumed operations, and we
are seeing a quick recovery trend in all our segments, and
sales, particularly in our high-end brands, are exceeding
year-ago levels," it said.
($1 = 105.0100 yen)
(Reporting by Ritsuko Ando, Editing by Sherry Jacob-Phillips)
((Ritsuko.Ando@reuters.com; +81 3 6441 1743;))