Shiseido sales impacted by weaker customer sentiment in China and travel retail

Japanese beauty group Shiseido Company has reported a 1% decrease in net sales for the first half of 2024, following weaker customer sentiment in China and travel retail.

In Japan, the company's sales increased 13%, benefiting from the success of its core Shiseido, Clé de Peau Beauté and Elixir brands. Asia Pacific also delivered growth, with sales up 6%.

Meanwhile, EMEA grew 12%, driven by fragrance and the Drunk Elephant brand. It comes as the firm eyes further UK growth as it drives continued brand awareness and sales in the region.

However, growth from Japan, Asia Pacific and EMEA was more than offset by sales declines in China (-7%), the Americas (-5%) and Travel Retail (-23%) during the first of the year.

While many beauty companies are struggling in China due to a decline in travel retail and a slowdown in spending, Shiseido previously said the release of treated radioactive water from the Fukushima nuclear plant last year, which triggered a boycott of Japanese products by Chinese consumers, had also impacted sales.

Its operating profit was helped by the sales growth in Japan, Asia Pacific and EMEA, structural reforms and agile cost management, but more than offset by a "sharp" profit decline in travel retail.

Looking ahead, the company said it plans to "invest in key focus areas and maximise sales in agile growth areas in a weak macro-economic environment" to ensure sustainable growth.

Last week, Shiseido named Kentaro Fujiwara as its new CEO, replacing Masahiko Uotani, who will retire at the end of this year. Fujiwara will take on the new role from 1 January 2025, having served as Chief Operating Officer since 2022.