The company is expecting a delay in recovery to persist in Q4.
Japan's cosmetics business Shiseido is expecting a net loss of $286.71m (JPY30b) for 2020 from a profit of $703.03m (JPY73.57b) in 2019, the company said in a bourse filing. Net sales is also expected to drop to $8.74b (JPY915b) from $10.81b (JPY1.13t) over the same period.
Consumer sentiment in Japan has been weaker than expected, whilst COVID-19 cases in Europe and the United States have been on the rise, with restrictions on movement and other measures being strengthened, the company noted. With these, net sales for Q3 fell short of the company’s projections in August.
"Considering that delay in market recovery will continue to a certain extent also in the fourth quarter, the Company has made a downward revision to its sales forecast for the full fiscal year as above," the company said.
Regarding profit, the company has assumed that it will maintain the previously announced break-even forecast for operating profit on an underlying basis, thanks to continued comprehensive cost reductions, despite lower gross profit.
However, it is expecting an impact from expedited measures such as inventory optimization in the Japan Business and reform of the Americas Business aimed at strengthening the business foundation toward 2021.
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