Sales: $8.5 billion
Key Personnel: Michitaka Sawada, president and chief executive officer; Masumi Natsusaka, managing executive officer, beauty; Katsuhiko Yoshida, managing executive officer, president, fabric and home care.
Major Products: Beauty Care—Sofina, Kanebo, Molton Brown, Bioré, Jergens, Asience, John Frieda, Goldwell; Fabric and Home Care—Attack, Haiter, Magiclean; Human Health Care—Pyoura and Clear Clean oral care, Bub bath additives.
New Products: Attack Powder refills, Flair fabric softener, Jergens Natural Glow sunless tanner, Goldwell Nectaya hair color.
Comments: Sales don’t jibe with last year’s results because Kao changed its fiscal year, reporting results in Japan for the nine months from April 1 to December 31, 2012 and results outside Japan for the 12 months ended Dec. 31, 2012. To arrive at the sales number, Happi used the historical exchange rate for the 12 months ended Dec. 31, 2012. Corporate sales totaled $11.8 billion.
That said, in a review of 2012, CEO Michitaka Sawada noted that in Japan, deflation continued and sentiment had turned gloomy as consumers worried about their future. Despite all the negativity, he noted that Kao has posted three consecutive years of sales and operating income increases. Last year, on a like-for-like basis, beauty care sales rose 0.5% on rising sales of Bioré products in Japan and Asia. Meanwhile sales of Jergens products provided a lift in the Americas. In premium hair care, sales of shampoos, conditioners and hair color was weak in Japan, but foam hair color sales were strong outside the country.
Sales of fabric and home care products rose 2.9% on a like-for-like basis, driven by demand for fabric softener and bleach in Japan and the launch of new Attack products in Asia.
For the first quarter of 2013, corporate sales rose 1.5% to nearly $3.1 billion. Beauty care sales rose 2% to more than $1.3 billion, while fabric and home care sales were up less than 1% to $666 million. For the year, Kao executives predict sales will rise 4.1% to $13.5 billion as they rebuild the prestige cosmetics business in Japan and restructure the consumer products business in China.
Looking ahead to 2015, Kao is aiming for corporate sales of more than $16 billion and operating income of $1.7 billion (based on 2012 exchange rates). By then, the company hopes international sales account for 30% of results. To achieve all that, Kao is promoting products in the area of cleanliness (including laundry detergents) to the growing middle class in emerging markets.
Meanwhile, in mature markets, Kao is determined to accelerate the growth of high value-added products as well as propose products and services that focus on the aging society.