Core Viewpoint - Sasa International Holdings Limited is exiting the offline retail market in mainland China by closing all its remaining 18 stores by June 30, 2025, due to declining sales and a shift towards online shopping [1][3]. Financial Performance - For the fiscal year ending March 31, 2025, Sasa International reported a 9.7% year-on-year decline in total revenue to HKD 3.942 billion, with net profit plummeting 64.8% to HKD 76.97 million [2][3]. - The core market of Hong Kong and Macau saw a revenue drop of 12.3% to HKD 2.992 billion, accounting for 75.9% of total revenue [2]. - The Southeast Asian market emerged as a growth engine, with offline sales increasing by 15.4% to HKD 0.332 billion [2]. Market Dynamics - The mainland China market experienced a 10.5% decline in revenue to HKD 0.521 billion, with online channels representing 80.3% of sales, a slight increase of 0.6% to HKD 0.418 billion, while offline sales fell 38.2% to HKD 0.103 billion [3]. - Sasa's strategy to close all offline stores in mainland China is attributed to the dominance of online sales and the inability to achieve economies of scale with the current number of stores [3]. Competitive Landscape - Sasa International's competitive advantage has weakened due to the rise of domestic beauty brands and local beauty stores, leading to a reduction in the number of stores from 77 to 37 since the fiscal year 2022 [3]. - The company plans to focus resources on developing its online business and enhancing brand visibility through social media and digital channels [3]. Product Quality Issues - Sasa faced a penalty of HKD 990,000 due to quality issues with its "sasatinnie Moisturizing Hand Cream," which was found to have a bacterial count exceeding the safety standards by 410 times [4][5].