Kao Corp., the country's largest maker of personal-care products, said Wednesday its nine-month profit fell 7 percent as higher raw materials costs cut earnings from its soaps, shampoos and detergents.
Net income was ¥53.7 billion in the nine months to Dec. 31, down from ¥57.7 billion posted during the same period the previous year, the company said in a statement to the Tokyo Stock Exchange. Sales rose 7.3 percent to ¥1 trillion.
"Rising costs of crude oil and other raw materials significantly affected our profits," the statement said, adding Kao was expanding sales of higher-margin products and reducing costs to compensate.
The Tokyo-based maker of Asience shampoo and Curel skin-care products is reluctant to pass on higher costs to customers in Japan, where retail sales fell for seven of the past 12 months. Rising taxes, falling wages and an aging population have resulted in weak demand in the world's second-largest retail market.
Kao said it would spend as much as ¥15 billion to buy back up to 5 million shares, or about 0.9 percent of its outstanding stock.
The company maintained its forecast for full-year profit to decline 6.4 percent to ¥66 billion.