Kao tends to increase the production of disinfection and sterilization products

According to a report in Nikkei Asian Review, the Japanese beauty company Kao Group has announced that the sales of disinfectant hand sanitizers in the epidemic situation will offset the decline in the company's main cosmetics series sales.

Although Kao predicts that the group ’s operating profit for fiscal year 2020 will increase by 4% to 9% to reach 220 billion yen to 230 billion yen (approximately RMB 14.44 billion to 15.1 billion yuan), this does not fully explain the new crown The damage caused by the virus to the Japanese retail industry. JPMorgan Chase Securities Japan predicts that due to the decline in Japan ’s tourism industry, Kao ’s consolidated operating profit for the previous quarter fell by 15% year-on-year.

From the beginning of the epidemic to the present "post-epidemic stage", Japanese department stores have been hit continuously to varying degrees. In January, Japanese department store sales decreased by 3.1% year-on-year, falling into negative growth for four consecutive months, mainly due to the decline in the number of consumers trapped in the epidemic. Due to the sudden decrease in the number of Chinese tourists visiting Japan, the sales of duty-free commodities in large department stores in Japan fell by double digits year-on-year during the Spring Festival, and tourism, aviation and other industries were also hit hard.
 
In February, Japanese department store sales fell 12.2% year-on-year to 366.1 billion yen (approximately RMB 24.06 billion), a five-month decline, and the total number of store customers decreased by approximately 10% year-on-year. During the epidemic, the reduction of local consumers in Japan caused a sluggish consumer demand. During the period, domestic tourists visiting Japan even more rarely plunged 87.9% to 87,000, resulting in a tax-free sales of 91 department stores in Japan fell 65% to 11.02 billion yen (approximately RMB 724 million), the number of tax-free consumers A year-on-year decrease of 68.3% to 134,000. In March, sales of department stores across Japan are expected to decline by 40% year-on-year, a record decline.

Although Kao has also been hit by the double consumption of tourists and the decline in store traffic, the continued global focus on health and hygiene and the growing demand for health products are helping it achieve its financial expectations.
 
During the epidemic, consumer demand for anti-killing products surged, including hand-washing products, alcohol disinfectants and antibacterial wipes. Kao CEO Michitaka Sawada said at the meeting: "Even in extraordinary times, we will certainly be able to achieve the goal of 31 consecutive years of dividend growth."

During the epidemic, Biore is one of Kao Group ’s best-selling hand sanitizer brands. To meet demand, Kao will produce disinfection products in four factories in Japan, which may increase its output by 20 times .