2025-10-15 03:14Summary of Key Points from the Conference Call Industry Overview - Industry: Beauty and Cosmetics in China - Current Trends: China's beauty demand and promotions have stabilized in 2025, with growth driven by onshore e-commerce channels while travel retail continues to decline [1][2][4] Market Performance - Sales Growth: Government data indicates a 3.3% growth in cosmetics sales from January to August 2025, slightly below GDP growth but an improvement from a 1.1% decline in 2024 [2][4] - Channel Performance: - E-commerce platforms experienced a 5-10% growth in beauty sales [2] - Hainan travel retail saw an 8-10% decline [2] - Offline sales are expected to be a drag on overall performance [2] Key Brand Performances - L'Oréal: Sales dipped by 0.2% to 0.3% in Q1 2025 but rose by 3% in Q2 2025, with a full-year target of approximately 5% growth [4] - Estée Lauder: Onshore e-commerce grew in mid-single digits in Q1 2025, with travel retail contributing about 15% of full-year sales [4] - Shiseido: Reported a low single-digit decline in Q2 2025 sales, with e-commerce up in low teens but offline and travel retail down sharply [4] - Amorepacific: Post-restructuring, sales in China increased by 30% YoY in Q2 2025, with expectations for double-digit growth into Q3 2025 [4] - LG Household & Health Care (LGHH): Focus on profit led to over a 10% sales decline in China and a 30% drop in travel retail in H1 2025 [4] - Giant Biogene: Expected 21% sales growth in H2 2025 for Comfy and 33% for Collgene, with strong performance anticipated during the 11.11 shopping event [4] - Proya: Sales trends remain weak in Q3 2025, with potential for growth momentum in 2026 [4] 11.11 Shopping Event Insights - Promotions: Tmall's event began on October 15, 2025, with a notable reduction in overall promotions compared to previous years [3][4] - Average Selling Price (ASP): Most leading brands' flagship products showed similar or slightly higher ASP year-over-year [3] Market Risks and Future Outlook - Risks: The industry faces risks related to over-reliance on large promotions and macroeconomic weaknesses [2] - Price Competition: Expected to moderate somewhat, indicating a potential stabilization in pricing strategies [2] Additional Insights - Korean Cosmetics: Travel retail for Korean cosmetics shipped to China is estimated to have declined by 25-30% in the first half of 2025 [2] - Channel Overhaul: The necessary channel overhaul for China's beauty market appears to have concluded, with travel retail dropping to approximately 50% and 60% of their respective peaks in 2021 [2] This summary encapsulates the key points discussed in the conference call regarding the beauty and cosmetics industry in China, highlighting market performance, brand-specific insights, and future outlooks.