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Kao Q1 2020: Health & Home Care Segments Up, Beauty Segments Down

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Relating to the COVID-19 pandemic, Kao Corporation's home care and health care segments saw growth in Q1 2020, while cosmetics, hair and skin care sales declined, apart from hand cleansing products.

Kao Corporation has released its financial results for Q1 2020, which revealed net sales totalled ¥337.8 billion, a 2.6% decrease year-over-year. Despite the overall decline in sales, the health care and home care segments posted growth.

Previously: Kao Corporation Earns 2 Recognitions & Achieves ESG-based Goal

In the Kao Group’s key markets during Q1 2020, according to retail sales and consumer purchasing survey data, the cosmetics market in Japan shrank significantly from the previous year while the household and personal care products market grew as a result of increased demand for hygiene-related products. Average unit prices for household and personal care products increased by 2 percentage points compared with the same period a year earlier.

Related: Kao Corporation Announces Fiscal 2019 Financials & New Board Member

In relation to COVID-19, the fabrics and home care business segment saw laundry detergent, laundry bleach, kitchen bleach, kitchen cleaning agents and dishwashing agents perform strongly in Japan, while sales of hygiene-related products also grew significantly in Asia.

While overall sales for the skin care and hair care business segment decreased, certain products like the Bioré hand soap and hand sanitizer increased, particularly in the Americas.

Amid these circumstances, net sales decreased 2.6% compared with the same period a year earlier to ¥337.8 billion. On a like-for-like basis, net sales increased 0.6%. Operating income was ¥39.3 billion, an increase of ¥1.1 billion year-over-year, and income before taxes was ¥37.3 billion, a decrease of ¥1.3 billion. Net income was ¥27.2 billion, an increase of ¥0.2 billion.

By segment

Consumer products
  • Cosmetic business: ¥59.2 billion, down 12.1% year-over-year
      • Japan: sales down 15.7%
      • Asia: sales up 0.1%
      • Americas: sales up 2.4%
      • Europe: sales down 3.2%
  • Skin care and hair care business: ¥74.1 billion, down 8.1% year-over-year
      • Japan: sales down 13.5%
      • Asia: sales down 8.1%
      • Americas: sales up 7.4%
      • Europe: sales down 10%
  • Human health care business: ¥61.9 billion, up 1.3% year-over-year
      • Japan: sales up 2.6%
      • Asia: sales down 0.5%
      • Americas: sales up 6.1%
      • Europe: N/A
  • Fabric and home care business: ¥81.1 billion, up 10% year-over-year
      • Japan: sales up 10.3%
      • Asia: sales up 11.4%
      • Americas: sales up 0.2%
      • Europe: sales down 8.7%
Chemical
  • Chemical Business: ¥69.8 billion, down 5% year-over-year
      • Japan: sales down 7.9%
      • Asia: sales down 3.1%
      • Americas: sales down 1.2%
      • Europe: sales down 4.1%