THE WHAT? The Estee Lauder Companies has reported its results for the second quarter of fiscal 2020. The US prestige cosmetics giant hailed its financial performance as ‘exceptional’ as net sales grew 15 percent to US$4.62 billion.
THE DETAILS Skin care was the best performing category, putting on 37 percent in the three months ended December 31, 2019 versus the same period in the prior year to reach US$2,205 million thanks to a strong performance from the La Mer and Estee Lauder brands, among others.
Make-up sales, meanwhile, were primarily driven by Tom Ford Beauty, Bobbi Brown, Estee Lauder and La Mer, although lower net sales from both BECCA and Smashbox meant the category’s overall growth was modest, up 6 percent to US$1,660 million.
On a regional basis, while the Asia-Pacific reason reported the most impressive leap in sales (+29 percent to US$1,319 million), the company also saw double-digit growth in Europe, the Middle East and Africa (+18 percent to US$2,079 million) while growth across the Americas remained flat, thanks to soft color cosmetics sales, inching up 1 percent to US$1,226 million.
THE WHY? Fabrizio Freda, President and Chief Executive Officer said, “Our multiple engines of growth generated broad-based gains across all our regions and major categories, as our prestige brand portfolio was well received by global consumers during the Singles Day event and holiday season.
However, he cautioned, “In the wake of the recent coronavirus outbreak, we are first and foremost concerned about the health and safety of our employees, consumers and everyone affected in China and around the world. The global situation will also affect our financial results in the near term, so we are updating our fiscal year outlook. With our results to date and our agility in allocating resources, we will strive to deliver full-year growth at least in line with our long-term goals, even in this challenging moment. We will be ready to return to our growth momentum as the global coronavirus outbreak is resolved.”