Estée Lauder Q2 sales up 10%

Published: 6-Feb-2012

The Estée Lauder Companies has reported a 10% increase in Q2 net sales


The Estée Lauder Companies has reported a 10% increase in net sales for the second quarter ending 31 December 2011 compared to net sales in the same quarter the previous year. Q2 net sales reached $2.74bn. In addition, net earnings for the company rose 15% to $396.7m.

“The Company’s strong second quarter results complete an outstanding first half performance,” said president and ceo Fabrizio Freda. “Our sales and profits this holiday season came in higher than planned and demonstrate the vibrancy of our brand portfolio in solid as well as soft economies.

“Our results were again broad based across brands, regions, categories and channels. The key drivers of our 10% sales growth were the US, China, travel retail and online. Importantly, we continued our consistent gross margin and operating margin improvements.”

Skin care grew by 14%, thanks to strong sales from recent launches and continued growth of products such as Advanced Night Repair Synchronized Recovery Complex, La Mer and the Origins Plantscription line of products.

Make-up also showed strong growth, primarily from make-up artist brands and certain heritage brands.

Growth in hair sales was led by higher sales from Aveda, including the launch of its Invati line of products, and strong sales growth by Bumble and bumble. This was offset by sales declines at Ojon.

On the other hand, there was an overall decrease in fragrance sales, particularly in western Europe, despite sales gains in the Americas and the Asia Pacific. This was in contrast to the same quarter last year when net sales of fragrances grew by 11%.

During the third quarter, The Estée Lauder Companies is expecting its net sales to increase between 4% and 5% in constant currency and it will “continue to build momentum and share”, increasing global advertising spend by approximately $80m to support major product launches and successful existing products.

For fiscal 2012, the company says it expects to continue to grow faster than the global prestige beauty industry, assuming some softening particularly in certain European countries, Japan and Australia and a slowing growth trend in the Chinese economy.

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