The US beauty retailer said consumers continue to be highly engaged with the beauty category despite economic pressures
Ulta Beauty opened 10 new stores during the period
Ulta Beauty has reported record Q1 sales with prestige cosmetics and make-up's big comeback boosting growth.
The US retailer's top boss Dave Kimbell said, in the earnings conference call, it has seen elevated customer engagement within the beauty category.
Sales of make-up exceeded pre-pandemic levels in both mass and prestige cosmetics during the period.
Concealers, eyeliners and lipstick were standout categories, said the CEO, and the strong sales were bolstered by new product launches from Clinique, Nars and NYX.
Rihanna’s Fenty Beauty, R.E.M. Beauty by Arianna Grande and Treslúce, a mass cosmetics brand founded by Latine musician Becky G, were highlighted for a strong performance in Q1.
Kimbell also noted the strategic retail expansion of legacy brands. MAC is now available in an additional 230 stores and Chanel Beauty moved into 104 outlets during the period.
Fragrance, bath, hair care, skin care and make-up all delivered double-digit year-on-year growth.
Ulta Beauty reported growth from sales of sun protection and self-tanning products, as customers increased travel and social activities.
Black Girl Sunscreen was singled out for its strong performance.
Fragrance also saw double-digit growth in the period, bolstered by sales from this year’s Valentine’s Day.
Overall sales benefited from fewer Covid-19 restrictions, compared with 2021, reported Ulta.
More shoppers have participated in bricks-and-mortar activities, engaged in travel and leant into experiential spending.
Despite macroeconomic pressures such as rising inflation, Kimbell said consumer’s “resilience” and “emotional connection” to beauty continues to drive the recovery of the category.
He added that this consumer demand, paired with the strong execution of the retailer’s strategic priorities, supported the “exceptional results”.
Operating income increased to $437.7m during the quarter, compared with $305.3m in Q1 2021.
Gross profit, meanwhile, increased to $941m, and comparable sales, which covers stores that have been open for at least 14 months as well as e-commerce sales, increased by 18%.
“The Ulta Beauty team delivered exceptional first quarter results, with better-than-expected sales and earnings growth, supported by double-digit comparable sales growth across all major categories,” said Kimbell.
“Solid execution of our strategies, paired with strong guest demand, fuelled our financial performance and continued market share gains as we delighted our guests with exciting brand launches within our one-of-a-kind assortment and differentiated guest experiences.”
Kimbell’s outlook on the state of the beauty sector echoes a recent statement from L’Oréal’s Chief Executive, Nicolas Hieronimus, who said that the rise in inflation is not hampering purchases of cosmetics.
Speaking to Reuters, Hieronimus, who replaced L’Oréal’s long-standing CEO Jean-Paul Agon in 2020, said: “So far, we see no impact of inflation and price impacts on consumers’ beauty consumption.”
Other surveys have also found that the cosmetics market continues to remain buoyant.
According to findings by bank Barclaycard, consumers are still willing to splash cash on beauty items, including make-up and fake tan.