Sa Sa International Holdings (Chinese: 莎莎國際) (SEHK: 178) is a Hong Kong-based chain store company selling cosmetics, personal care, skin care and baby care products.
For the year ended 31 December 2014, Sasa’s turnover amounted to HK$8,756 million, representing an increase of 14.2% over the HK$7,670 million recorded last year. The Group’s profit for the year 2014 was HK$4,073 million, a decrease of 14.5% over the HK$3,558 million recorded last fiscal year. Basic earnings per share were HK33.0 cents, as compared to HK29.3 cents in the previous fiscal year. The overall gross profit margin of the Group for the full fiscal year increased to 46.52% from 46.39% last year.
The principal activity of Bonjour Holdings (Chinese:卓悅控股) (SEHK:653) is principally engaged in the retail and wholesale of beauty and health-care products and the operation of beauty and health salons in Hong Kong, Macau and the PRC.
For the year ended 31 December 2014, Bonjour’s turnover amounted to HK$3,144 million, representing an increase of 3.5% over the HK$3,039 million recorded last year. The Group’s profit for the year 2014 was HK$226 million, a decrease of 17.2% over the HK$273 million recorded last fiscal year. Basic earnings per share were HK6.6 cents, as compared to HK8.3 cents in the previous fiscal year. The overall gross profit margin of the Group for the full fiscal year increased to 47.68% from 47.35% last year.
Sasa has a great name and good brand so it attracts big cosmetic names and customers trust it for the brands it sells, especially tourists from mainland China. Also it has advantages in going overseas market. Compared with Bonjour, Sasa is a larger enterprise and performs better than Bonjour generally, statistically speaking. But Bonjour also is a company with good development, and its gross profit margins were even a little bit higher than Sasa’s. And for stock investors, Bonjour’s price was much cheaper and the return of investment was considerable.
In recent years, the overall retail market in Hong Kong was challenging. The retail industry sailed through ups and downs throughout the year as a result of the instabilities of the external environment and the change of Mainland tourists’ consumption pattern. According to the statistics in 2014 released by the Census and Statistics Department, the total retail sales value edged down 0.2% to HK$493.3 billion compare to 2013. Hong Kong’s annual retail sales figures fell for the first time since the SARS outbreak in 2003.Given the current social unrest expelling the PRC tourist inflow to Hong Kong and the change in tourist mix with less spending pattern, Sasa and Bonjour are inevitably facing a challenging environment. As the two cosmetics retail giants in Hong Kong even Asia, their financial performance can be used as a benchmark of this industry.
This report consists the Common-Size Income Statement, Income Statement- YTY comparison, Common-Size Balance Sheets, Balance Sheets-YTY Comparison and Ratio Analysis of Sasa and Bonjour in 2014,2013 and 2012, and comments followed.
Produced by SONG Yingjin in 2015.11