Shiseido Reports Gains in China

Shiseido Co. today said its sales in China were up on-year in June after a steep falloff in previous months on the back of the SARS epidemic. Although specific figures weren’t available, a company spokesman said sales in China and Hong Kong in terms of local currency were in “plus territory” in June after dropping some 20% in April and May.

Figures so far in July also look strong and should be better than for the same month last year, he said. “Sales (in China) are now going back to normal.”

China is a crucial market for Shiseido given weak domestic demand. In addition to its launch of high-end and general cosmetics products there, Shiseido has added toiletry products to the range of products it sells in China.

Sales in China and Hong Kong comprise about 3% of Shiseido’s overall sales. In yen terms, its sales in China and Hong Kong for the business year ended March climbed 25% to Y17 billion. Shiseido also said its group sales during the April-June quarter came to Y141.75 billion, down 3.6% on year. The spokesman said the yen’s strength led to a moderate 1.7% gain in overseas sales when translated into Japanese currency terms.

Domestic sales dropped 5.4% on-year amid the weak consumption. Still, the company kept intact its earnings targets for the full year ending March 2004.