The agency’s well being and wonder division noticed gross sales lower 4.8% on a like-for-like foundation to JPY261.2bn (U$2,29bn) within the third quarter of its monetary 12 months whereas working revenue dropped JPY6.1bn (U$53.6m) to JPY41.3bn (U$490m) within the 9 months ending September 30.
It attributed the droop to the falling demand for hygiene-related merchandise.
Gross sales of hygiene merchandise grew tremendously final 12 months because of the heightened consciousness of hygiene triggered by the COVID-19 pandemic.
In 2020, the non-public care main boosted the manufacturing of hand soaps and sanitisers as demand continued to exceed provide effectively into the center of the 12 months.
Nonetheless, Kao reported seeing a “substantial shrinkage” of demand for hand hygiene merchandise, which negatively affected skincare gross sales, which additionally suffered from low gross sales of solar care merchandise as shoppers shunned going outdoor.
“Final 12 months, there was a scarcity of hand soaps and hand sanitisers out there the place our robust provide functionality was demonstrated. Nonetheless, this 12 months, rivals have enough provide competing for market share. Our gross sales dropped as a result of the scenario turned out to be barely completely different than what we anticipated,” stated Tomoharu Matsuda, consultant director, managing govt officer president, client merchandise.
Regardless of the droop, Kao managed to extend its market share of hand soaps and sanitisers from the pre-pandemic days.
In keeping with the agency, Bioré now holds the most important share out there for hand soaps and hand sanitisers mixed.
To revitalise this phase, Kao stated it could be launching new hand hygiene merchandise beneath the Bioré model within the subsequent quarter.
Hair care noticed a lower in demand for mass-market merchandise whereas the skilled hair care division began to recuperate regularly in Europe with the benefit of pandemic restrictions.
In America, hair care gross sales have been strong because of the recognition of Oribe hair care merchandise and its robust e-commerce gross sales.
Kao’s cosmetics arm, which consists of magnificence manufacturers together with SENSAI and Kanebo recorded a gross sales enhance of 0.8% on a like-for-like foundation to JPY165.9bn (U$1.45bn). Working revenue elevated by JPY7.4bn (U$65.1m)
The rise was credited to the launch of recent product improvements catered to masks wearers, such because the Curél Moisture Restore Sheet Masks developed to fight dry and delicate pores and skin that has been aggravated by frequent mask-wearing.
Within the fourth quarter, the corporate will probably be launching extra of such merchandise, together with after-mask skincare from DEW and a brand new KATE mascara developed for mask-wearers.
In Asia, gross sales elevated by 35% due to robust e-commerce gross sales of Curél and freeplus in China.
To capitalise on the robust e-commerce development in China, Kao will probably be launching the Kao Mall on an e-commerce platform in November.
Equally, it additionally noticed elevated e-commerce gross sales in Europe on account of the agency’s digital investments. Coupled with the benefit of lockdowns and restrictions, Europe noticed gross sales enhance by 6.6% total this quarter.
Subsequent 12 months, the corporate is planning to launch its personal e-commerce website, My Kirei by Kao, particularly to strengthen the place of its mass-market merchandise within the European and American markets.
Nonetheless, the expansion in Asia and Europe couldn’t offset the droop in Japan, the place the agency noticed a lower in gross sales because the extended state of emergency current robust situations for make-up merchandise specifically.
Amid these situations, the corporate’s internet gross sales decreased 0.4% to JPY1.021bn (U$8.98bn) on a like-for-like foundation. Working revenue decreased JPY11.1bn (U$97.6m) to JPY109bn (U$958m).