A.S. Watson: H1 revenue down 11%

Date : 06 August 2020

Charles Chan

Senior Retail Analyst

The world's largest international health and beauty retailer, A.S. Watson, has posted its results for the first half ending 30 June 2020.

COVID-19 severely impacts H1 revenue

A.S. Watson's retail division is split into five subdivisions, Healthy & Beauty Western Europe, Eastern Europe, China, Asia and Other Retail

  • Total retail revenue fell -11% to HKD73.6bn (US$9.5bn)
  • In local currencies, revenue, EBITDA and EBIT fell by -9%, -42% and -53% respectively verses same period last year
  • Total retail comparable stores sales growth down -9.5%
  • H&B comparable stores sales growth down -12.7%
  • Other retail (includes PARKnSHOP, PARKnSHOP Yonghui, Fortress, Watson’s Wine and manufacturing operations for water and beverage businesses) comparable stores sales growth up 10.8%
  • Total retail store network increased by 4% to 15,836 YoY
  • Operating in 25 markets with 12 retail brands
  • 137m loyalty members worldwide
  • 34% exclusives sales participation

H&B Asia sales -17% in local currencies

  • Taiwan, Thailand & Malaysia leading the recovery with sales reduction of -5%, -7% and -8% in local currencies respectively in June
  • Philippines recovering more slowly, with sales reduction of -17% in local currency in June as populated areas are still under quarantine
  • Hong Kong remains challenging since the close of border in February with tourist comparable sales decline of over –90%

H&B China sales -26% in local currency

  • Reduction in customer footfall impacting results. Gradually improving, from the peak of -87% in February to –26% in June
  • Sales reduction peaked at -78% in February and recovered to -16% in June
  • MyStore (WeChat Enterprise app) enabled more than 22,000 Beauty Advisors to stay connected with the 63m loyalty members

H&B Western Europe -5% in local currencies

  • Benelux leading the recovery with sales growth of 5% in local currency in June
  • Germany H1 results have been positive, with sales and EBITDA growth of 4% and 12% in local currency respectively
  • UK results impacted by COVID-19 activities, but some improvements towards the end of June following easing of lockdown

H&B Eastern Europe -2% in local currencies

  • Despite weak consumer sentiment in Poland, still posted relatively solid sales with a decline of -4% in local currency in June

Want to know more?

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