A.S. Watson: H1 growth modest

Date : 01 August 2019

The world's largest international health and beauty retailer, A.S. Watson, has posted its results for the first half ending 30 June 2019.

Exchange rates impact H1 results

A.S. Watson's retail division, which is split into five subdivisions, Healthy & Beauty Western Europe, Eastern Europe, China, Asia and Other Retail, ended the first half of 2019 with 15,213 stores across 25 markets - a 5% increase compared to the same period last year. It also recorded a 2.9% increase in comparable store sales growth.

Total retail revenue fell 1% to HKD83.1bn (US$10.6bn), impacted by adverse foreign-currency exchange, but growth in local currency was healthier at 4%.

Overall, the Health and Beauty segment reported total sales growth of 1%. In local currencies, revenue, EBITDA and EBIT increased by 7%, 6% and 5% respectively against same period in 2018.

H&B Asia revenue up 9.3%

ASW’s H&B Asia segment posted a 9.3% increase in revenue to HKD15,7bn (US$2bn). It added 270 net new stores to reach 3,221 outlets at the end of H1.

H&B China comparable sales up 2.2%

Health and Beauty China maintained a healthy EBITDA margin of 19% and recorded a 4% growth in EBITDA in local currency from continued expansion in store network. The division reported 2.2% comparable stores sales growth and added 289 net new stores to reach 3,666 outlets.

H&B Europe comparable sales up 1.9%

Health and Beauty operations in Europe also sustained a strong EBITDA growth of 5% in local currencies from a 3% increase in store numbers and a 1.9% growth in comparable stores sales.

PARKnSHOP Yonghui in Guangdong

During the first half of 2019, ASW’s China supermarket business completed a joint venture with Yonghui and Tencent to create the largest grocery retail business in Guangdong, China, in which ASW holds a 40% stake.

Growing base of loyal customers

A.S. Watson continues to increase its base of loyal members. It has 135m loyalty members in Health & Beauty. Exclusives sales contribution to total H&B sales is at 34% and loyalty members’ sale participation is 63%.

Want to know more?

Asia subscribers can read more on A.S. Watson's Strategic Outlook here.