By Kosaku Narioka
Shiseido shares fell sharply after it cut its earnings guidance for 2023 due partly to a worsening of its business in China.
Shares were recently 14% lower at 4,191 yen on Monday morning.
Shiseido said after Friday’s market close that it projects net profit to drop 47% to Y18.00 billion ($118.8 million) this year, down from its previous forecast of Y28.00 billion, and revenue to fall 8.2% to Y980.00 billion, down from Y1.000 trillion expected previously.
The Japanese cosmetics maker said its business had been weak in China and its duty-free stores as retailers cleared their inventory. It said the economic sentiment in China has deteriorated, and Chinese consumers have pulled back on purchases of Japanese products after Japan’s discharge of wastewater from the Fukushima Daiichi nuclear plant in late August. Shiseido said it will book Y6.0 billion of impairment losses from the restructuring of its plant operations in Osaka this year.
For the nine months ended September, net profit dropped 29% from a year earlier to Y20.52 billion and revenue declined 5.3% to Y722.42 billion.
Write to Kosaku Narioka at [email protected]
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