THE WHAT? Coty has announced a predicted 20 percent sales fall for Q3 fiscal 2020 due to the economic implications of the COVID-19 pandemic.
THE DETAILS In a bid to offset the financial fallout, the cosmetics company has also announced 25 percent executive pay cuts, with non-employee directors, as well as CEO Pierre Laubies and CFO and COO Pierre-Andre Terisse, having their salaries cut through to the end of the 2020 fiscal year.
According to a company statement, Coty said, “The company has reviewed its financial position in view of the current market conditions, which are expected to amplify moving into [the fourth quarter]. Coty confirms that following the amendment of its financing arrangements in 2019, it has ample and sufficient liquidity and headroom to meet its covenants based on management’s current view of market conditioners.”
The company has seen a temporary share value drop of 52 percent.
THE WHY? Coty is amongst the many cosmetics companies feeling the hit of the coronavirus outbreak as consumers look to purchase essential household items amidst the pandemic.
However, the company has stated it will look to balance the fall out through a harder push via Amazon and of Kylie Cosmetics sales in Europe.