Estée Lauder Companies (ELC), the owner of Clinique, MAC Cosmetics and Tom Ford Beauty, has exceeded sales of its March 2019 results for the same period in 2021 – showing the company is on the road to recovery.
Net sales reached US$3.86bn for the period ended 31 March, an increase of 13% from $3.35bn in Q3 2020, while earnings were up $465m compared with a nosedive in the year prior, with a catastrophic loss of $6m.
Skin care showed the most improvement for the three months with sales growing strongly across the category, led by Estée Lauder, La Mer and Clinique, while Dr Jart+ and Origins also contributed to growth.
Make-up, however, continues to be the group’s problem child, with demand still weak among consumers.
Net sales were down 13% for the three month period, an operating income loss of $72m for the category.
In order to offload some of its troublesome brands, ELC took the decision to shut down operations of Becca Cosmetics earlier this year, which will cease operations from the end of September, citing challenges brought on by Covid-19.
Meanwhile, premium skin care brand Rodin Olio Lusso became the second brand to be axed by the New York-based conglomerate after just six years of ownership.
After the merger, ELC was instrumental in expanding the brand’s skin care portfolio into make-up.
Despite a disappointing make-up group, ELC has expanded its skin care bands with the integration of Deciem.
In February, the New York-based beauty conglomerate announced plans to increase its initial investment in the skin care company from 29% to 76% and will take complete ownership of Deciem within three years.
“Our fiscal year-to-date sales and adjusted operating margin exceed that of the same period in fiscal 2019, as we continue to successfully navigate the challenges of the pandemic,” said Fabrizio Freda, President and CEO of ELC.
“We are thrilled to have agreed to increase our ownership in Deciem, becoming majority owners with a path to full ownership in three years,” he added.
“Deciem’s soaring brand The Ordinary and new brand incubation capability further enhance our superior multiple engines of growth strategy.”
