Shiseido revises 2017 forecast, closing some 100 BareMinerals stores
Shiseido said on Wednesday it expects both full-year net sales and operating income to exceed previous forecasts and reach record highs, resulting from the profit of its sale of Zotos to Henkel for $485 million.
The Japanese beauty giant now expects to post an 'extraordinary' income of 36 billion yen, according to a press release. However, it downgraded its consolidated net profit forecast for the year ending December to 10 billion yen, down 69% on the year, a reversal from the previously projected 1% increase.
In the same announcement, the Tokyo-based firm said it would post a loss of 65.5 billion yen for the third-quarter period, due for release Nov. 7, as an impairment charge on intangible assets and other assets associated with Bare Escentuals, part of Shiseido Americas Corporation, and operator of BareMinerals.
Net income attributable to shareholders is forecast at 10 billion yen, 22.5 billion yen down from the previous forecast.
As a result, Bare Escentuals plans to close some 100 BareMinerals stores nationally (from its current 209 boutiques), in a bid to refocus the natural cosmetics brand. Future steps include "product innovation, and investment into digital marketing geared toward Millennials and Generation Z," said Shiseido, in a statement, adding that the brand contributes annual sales worth $50 million.
Shiseido said "the low profitability of the Americas and EMEA businesses is a lingering issue" for the group, something it hopes will change with the recent appointment of Susan L. Jurevics as Bare Escentuals’ president in July.
At the time of Jurevics' appointment, Marc Rey, president and CEO of Shiseido Americas, explained the direction the company wants to take with BareMinerals.
Specifically, he noted the brand needs help navigating "the rapidly changing digital landscape" and that it will be exploring "new methods of driving consumer engagement" under Jurevics' leadership.
Shiseido acquired Bare Escentuals in 2010 from QVC for $1.7 billion.
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