Beauty behemoth Estee Lauder has reported net sales of $2.52 billion, compared with $2.73 billion in the prior-year period, for the three months ended June 30, 2015. However, the company has stated that this included the effect of the accelerated retailer orders, which created an unfavourable comparison with the fiscal 2015 fourth-quarter results.
The shortfall also looks to be affected by weakening demand for Clinique and Estee Lauder skin care products, with the company’s skin care division falling by 16 per cent to $1.01 billion in the fourth quarter. Estee Lauder is said to be focussing on youth-oriented brands such as Smashbox and Glamglow.
Net earnings of $153.0 million were reported, compared with $257.7 million last year.
Travel retail sales declined by four per cent, hit by a stronger dollar and a deadly outbreak of Middle East Respiratory Syndrome (MERS) in South Korea.
Estee Lauder reported strong gains in the U.S., after adjusting for the accelerated orders, with constant currency double-digit gains in the U.K. Double-digit constant currency increases were generated in many European emerging markets, as well as in Asia Pacific.
The company reported sales of $10.78 billion, a two per cent decrease compared with $10.97 billion in 2016. Net earnings for the year were $1.09 billion, compared with $1.20 billion last year, and diluted net earnings per common share were $2.82, compared with $3.06 reported in the prior year.
Sales of fragrances decreased due to negative impact of foreign currency translation and lower sales of Estee Lauder, Clinique and designer fragrances, while Michael Kors and luxury brands such as Jo Malone London and Tom Ford recorded strong double-digit sales gains.
Hair care reported growth, boosted by expanded global distribution, primarily in salons, freestanding stores and travel retail for Aveda and from specialty-multi brand retailers for Bumble and bumble.