ANNUAL REPORT 2018

Facts & Figures

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  • Facts & Figures

[Net Sales] [Net Sales]

¥1,094.8billion year on year+8.9% year on year on a local currency basis+8.8% Organic net sales excluding impact of business transfer in 2018 YoY change in LC+14%

Net sales grew 8.8% year on year on a local currency basis, driven by the prestige category which we continued to bolster strategic investments. On a yen basis, sales increased 8.9% year on year. In addition, net sales were up 14% year on year on an organic, local currency basis that excludes the impact of the business transfer carried out last year.

[Operating Profit] [Operating Profit]

¥108.4billion year on year+34.7%

Operating profit rose 34.7% year on year, due mainly to an increase in operating margin accompanying the growth in sales as well as the cost structure improvements that followed the strong performance of highly profitable prestige brands.

[Operating Margin]

9.9% year on year+1.9percentage points

Accompanying the progress toward an ideal cost structure, the operating margin increased 1.9 percentage points year on year.

[ROIC / ROE]

13.1% FY 201710.4% 14.1% FY 20175.6%

Following improvement in profitability, ROIC and ROE came to 13.1% and 14.1%, respectively, reaching the Company’s 2020 targets two years ahead of schedule.

[Net Sales by Business Segment (Year-on-year comparisons on a local currency basis)] [Net Sales by Business Segment (Year-on-year comparisons on a local currency basis)]

Share of total sales(%) Share of total sales(%)
[Countries and Regions Served] [Ranking in Japan and Asia] [Employees / Nationalities Employed] [Countries and Regions Served] [Ranking in Japan and Asia] [Employees / Nationalities Employed]

[Percentage of Female Leaders]

54.8% 54.8%

[Awards Received at IFSCC Congresses and Conferences]

26 26
More on the IFSCC Research Awards
  • Effective from 2018, the Company has revised its reportable segment classification method in line with the Group’s internal management structure. As a result, the Asia Pacific-based fragrance business, which was previously recorded under the EMEA Business, is now recorded under the Asia Pacific Business; the Travel Retail fragrance business, which was also previously recorded under the EMEA Business, is now recorded under the Travel Retail Business; and the 2e and NAVISION businesses, which were previously recorded under the Other segment, are now recorded under the Japan Business. Some of the NARS, bareMinerals, and LAURA MERCIER product distribution operations conducted by distributors in each region, which were previously included in the Americas Business, are now included in the Asia Pacific Business, EMEA Business, and Travel Retail Business. In addition, the business results of IPSA Co., Ltd., which were previously included in the Japan Business, are now included in the Other segment. Year-on-year comparisons are stated in line with the new method of classification.
  • The Other segment includes head office administration departments, IPSA Co., Ltd., and manufacturing operations, as well as the activities of the Frontier Science business (cosmetic raw materials and pharmaceuticals), the Restaurant business, etc.
  • The number of employees includes full-time employees and temporary employees. Temporary employees include part-time workers. Dispatched employees are excluded.
  • As of January 1, 2019
  • Excluding food and daily necessities
  • As of December 31, 2018 This is the same definition for women in management positions as the one used by the Ministry of Health, Labour and Welfare.
  • Abbreviation for the International Federation of Societies of Cosmetic Chemists. The IFSCC is an organization that brings together cosmetic chemists from around the world in pursuit of cosmetic technology development that achieves greater functionality and safety.
  • As of December 2018