Coty’s future looks rosier than ever. This morning Chairman and Interim CEO Bart Becht revealed that the company is “very excited” about the potential of its recent deal with P&G and lauded the progress the company made in fiscal 2015.
Becht made the company’s feelings known as Coty released its 2015 Q4 and fiscal year results earlier today. Looking at the full year, net revenues were $4,395.2m, flat like-for-like or a decrease of 3% as reported. Meanwhile net income grew to $232.5m and adjusted EPS were $0.99, up an impressive 22% from $0.81 in the prior year.
When looking at the results by segment, Coty's colour cosmetics arm was the stand-out performer, with net revenues growing 8%. Adjusted operating income for Colour Cosmetics grew 3% to $161m from $156.8m the year before. However, fragrances saw net revenues drop 2% like-for-like, largely due to declines in celebrity brands and lower level of new launch activity – similar reasons to those Elizabeth Arden recently gave in its latest financial results. But skin and body care took the biggest hit, down 5% like-for-like, driven by a decline in body care due in part to a business model change in china.
Becht said: “2015 was a good year. We made meaningful progress on our strategy of driving revenue growth on power brands, while fuelling profit growth behind efficiency programmes. During the year, power brand net revenue growth, while still modest, was in the low single digits like-for-like, driven by Marc Jacobs, Chloe, Sally Hansen, Rimmel, and philosophy. On profits and margins, we made material progress over the last nine months resulting in full year adjusted diluted EPS being up by 22%.
“In terms of driving profit growth behind efficiency programmes, we are happy to confirm that we have identified additional opportunities. As a result, we are increasing the savings target for our Global Efficiency Program by 35% to $270m by fiscal year 2017. These additional savings should allow us to continue to drive margin expansion, while also re-investing part of these savings to gradually improve the growth trajectory of the overall business.”
Speaking about Coty’s recent acquisition of 43 of P&G’s brands, Becht said: "We remain very excited about this transaction's potential for Coty." He explained that the company continues to believe the transaction will not only make a pure-play global leader out of Coty, but will also “offer material cost and cash savings as well as longer term enhanced growth opportunities”.