Japanese cosmetics manufacturer Kao has reported a 5.6% drop in net profits for the financial year ended March 2008. The company is attributing poor results to the increased cost of raw materials including petrochemicals and natural oils and fats.
The company posted a net profits of ¥66bn ($646m), down from ¥70.5bn a year earlier and operating profits were down 3.8% to ¥116.25bn, although sales were up 7% to ¥1.32 trillion. This reflects the fact that Kao has not raised finished product prices to cover increased material costs.
The company says it is forecasting net profit up 3.7% to ¥69bn, operating profit up 0.6% to ¥117bn and revenue up 0.9% to ¥1.33 trillion for the financial year ending March 2009.