Sa Sa's Chinese mainland cosmetics business lost millions in first half of 2011

Sa Sa International Holdings Limited, the Hong Kong-headquartered cosmetics retail group, has announced its interim results for the six months ended September 30, 2011, stating that it gained profit of HKD224.3 million, a year-on-year increase of 27.3%, and its basic earnings per share amounted to HKD0.8.

Sa Sa
sasa.com

The group reported that for the six months ended 30 September 2011, its consolidated turnover reached HKD2.786 billion, representing an increase of 32.7% from HKD2.099 billion in the same period last year. The group's performance benefited from the strong performance of the core market Hong Kong and Macau. However, the performance of its mainland business was poor and made losses of HKD19.75 million.

In regards to the losses, Sa Sa's executive team said it was mainly because of expense increases in personnel deployment, logistics, and expansion for new stores on the Chinese mainland. It expects the same kind of situation for the second half of the fiscal year, but said it will not have major impact on the overall performance of the group.

Simon Kwok, chairman and chief executive officer of Sa Sa, said that though the group's expansion in mainland China is slow, it will accelerate the expansion of its overall sales network and suppliers and mainland manufacturers can provide support. He also revealed that Sa Sa plans to open 15 new stores in mainland China in the future.

Kwok concluded that for the group as a whole, the ongoing strength of the mainland's economy and the further development of inbound tourism in Hong Kong and Macau, are all the reasons to believe that their business will continue to grow in the upcoming period.

Sa Sa is a leading cosmetics retailing group in Asia. With over 220 stores and counters in Asia, the company sells more than 600 brands of skin care, fragrance, make-up and hair care products including its own-brands and other exclusive international brands.
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