05.03.22
The Estée Lauder Companies Inc. has reported net sales of $4.25 billion for its third quarter ended March 31, 2022, an increase of 10% from $3.86 billion in the prior-year period. Organic net sales increased 9%.
Net sales grew in every product category, largely reflecting continued recovery in brick-and-mortar retail stores, driven by double-digit growth in The Americas and Europe, the Middle East & Africa (“EMEA”) regions, as well as growth in global online.
“We delivered strong sales growth and better-than-expected profitability in the third quarter of fiscal 2022 in the face of accelerated headwinds as the quarter evolved, including Covid restrictions in the Asia/Pacific region,” said Fabrizio Freda, president and CEO. “Every category grew organically, led by Fragrance’s outstanding performance globally and the makeup renaissance in western markets. Eleven brands contributed double-digit organic sales growth and further demonstrated our diversification, empowered by our multiple engines of growth strategy. Consumer demand remained robust even in this more inflationary environment.”
Makeup net sales increased, reflecting the continued progression towards recovery in western markets, increased usage occasions and easier comparisons to the prior year. The growth was led by M·A·C, Estée Lauder and Clinique.
Net sales grew in every region and across virtually all brands that sell fragrances, driven by continued resilience in luxury fragrance, the opening of more brick-and-mortar retail and the beginning of travel recovery in western markets.
Hair care net sales rose in every region, reflecting increases from both Aveda and Bumble and bumble as brick-and-mortar locations recover and online continued to thrive.
“We are confident that our business in China will rebound when Covid abates and accelerate our momentum,” Freda added.
Reported net sales are forecasted to increase between 7% and 9% versus the prior-year period.
Longer-term, the company expects to return to its growth targets of 6% to 8% sales growth, 50 basis points of operating margin expansion and double-digit adjusted diluted earnings per share growth in constant currency after a period of normalization as the impacts of the Covid-19 pandemic subside.
Net sales grew in every product category, largely reflecting continued recovery in brick-and-mortar retail stores, driven by double-digit growth in The Americas and Europe, the Middle East & Africa (“EMEA”) regions, as well as growth in global online.
“We delivered strong sales growth and better-than-expected profitability in the third quarter of fiscal 2022 in the face of accelerated headwinds as the quarter evolved, including Covid restrictions in the Asia/Pacific region,” said Fabrizio Freda, president and CEO. “Every category grew organically, led by Fragrance’s outstanding performance globally and the makeup renaissance in western markets. Eleven brands contributed double-digit organic sales growth and further demonstrated our diversification, empowered by our multiple engines of growth strategy. Consumer demand remained robust even in this more inflationary environment.”
Business Segments
Skin care net sales grew in The Americas and EMEA regions, led by strong double-digit sales growth from La Mer. This was partially offset by a decline in the Asia/Pacific region, which was impacted by transitory logistics constraints in China.Makeup net sales increased, reflecting the continued progression towards recovery in western markets, increased usage occasions and easier comparisons to the prior year. The growth was led by M·A·C, Estée Lauder and Clinique.
Net sales grew in every region and across virtually all brands that sell fragrances, driven by continued resilience in luxury fragrance, the opening of more brick-and-mortar retail and the beginning of travel recovery in western markets.
Hair care net sales rose in every region, reflecting increases from both Aveda and Bumble and bumble as brick-and-mortar locations recover and online continued to thrive.
Outlook
Given the company’s “outstanding performance” year-to-date, Freda says he expects to deliver a record year in fiscal 2022 despite temporary Covid-driven headwinds that reduced the fourth quarter outlook.“We are confident that our business in China will rebound when Covid abates and accelerate our momentum,” Freda added.
Reported net sales are forecasted to increase between 7% and 9% versus the prior-year period.
Longer-term, the company expects to return to its growth targets of 6% to 8% sales growth, 50 basis points of operating margin expansion and double-digit adjusted diluted earnings per share growth in constant currency after a period of normalization as the impacts of the Covid-19 pandemic subside.
