Shiseido Company (4911) investor relations material

Executive summary

• Achieved core operating profit of ¥44.5 billion (4.6% margin) in FY 2025, surpassing initial targets despite a 2.1% sales decline, driven by structural reforms and cost management.

• Free cash flow improved to ¥66.5 billion, supported by working capital optimization and disciplined capital expenditures.

• First time in four years to meet initial plan, reflecting strengthened financial discipline and stability.

• Focus brands led growth, with 4% like-for-like net sales growth in H2 and market share gains in Japan, China, and Asia-Pacific.

• Loss attributable to owners widened to ¥40.7 billion, mainly due to a ¥46.8 billion goodwill impairment in the Americas.

Financial highlights

• FY 2025 net sales were ¥970.0 billion, down 2.1% year-over-year; core operating profit rose 22.4% to ¥44.5 billion.

• EBITDA increased to ¥95.2 billion (+6% year-over-year); free cash flow improved by ¥101.8 billion from 2024.

• Non-recurring items included ¥73.3 billion in expenses, notably from a voluntary retirement program and goodwill impairment.

• COGS improved by 0.6 points to 23.3%; marketing investment ratio rose to 29.3%.

• Personnel expenses decreased by ¥11 billion; other SG&A down by ¥8.5 billion.

Outlook and guidance

• FY 2026 targets: net sales ¥990.0 billion (+2.1%), core operating profit ¥69.0 billion (7% margin), ROIC 5%, ROE 7%, free cash flow ¥50.0 billion.

• Annual dividend planned to increase to ¥60 per share (from ¥40 in 2025).

• JPY 10 billion in structure reform expenses planned for FY 2026.

• Strategic price revisions, wage increases, and new product launches factored into FY 2026 guidance.

• 2030 Medium-Term Strategy targets a core operating profit margin of 10% or more.