Breaking News

Sales Jump 10% at Estée Lauder

August 14, 2012

Results for fiscal 2012 approach $10 billion.

Lux is back in a big way. Estée Lauder fiscal 2012 sales rose 10% to $9.71 billion. Excluding the impact of foreign currency translation, net sales also increased 10% from a year ago. The company reported a 110 basis point increase in operating margin and net earnings for the year rose 22% to $856.9 million, compared with $700.8 million last year. Diluted net earnings per common share rose 24% to $2.16, compared with $1.74 reported in the prior year.

“A very strong fourth quarter, in which we generated double-digit growth in sales, excluding currency, and earnings per share, was driven largely by continued momentum in the U.S. and strong growth in China and travel retail. This performance capped another record year for our Company," said Fabrizio Freda, president and chief executive officer. "In fiscal 2012, we grew sales, net earnings and earnings per share by double digits. Our sales grew at twice the rate of worldwide prestige beauty, owing to the success of our highly innovative products, marketing prowess and personalized services."

Freda noted that despite pockets of economic uncertainty around the globe, Lauder's sales growth was broad-based, with strong gains in every geographic region and product category and many distribution channels.

"Financial discipline throughout our company enabled us to bring much of our sales growth to the bottom line. Our operating margin increased 120 basis points to a record 14.2%—exceeding our original forecast—and operating cash flow reached an all-time high of $1.1 billion," he added.


Moving forward, Lauder will continue to focus its efforts and resources in the most promising areas for prestige beauty, including emerging markets, travel retail and digital. At the same time, company executives expect to generate further cost savings and improve profitability.


"While we are positive about our long-term outlook we are cautious of further weakening in certain global markets," said Freda. "Nonetheless, we are confident in our growth prospects and we are extending our financial goals to fiscal 2015 and raising our operating margin target to 15.5% to 16%.”
The company’s performance was due to solid overall business, particularly from its largest brands. The company reported sales gains in each of its product categories and geographic regions. Net sales also grew in each major product category within each region. Sales growth was particularly strong in travel retail and overall in emerging markets, along with solid gains in several developed countries.

During the fiscal year, the company made substantial progress on its previously stated strategic goals, with a strong improvement in cost of sales as a percentage of net sales. All product categories and geographic regions benefited from company-wide efforts to reduce or eliminate non-value added costs. In connection with the long-term strategic plan and certain ongoing initiatives, the company realized savings of $145 million during the year. As a percentage of net sales, advertising, merchandising and sampling expenses increased to support the company’s biggest innovations, while all other significant operating expenses were lower. Gross margin expanded 140 basis points and operating margin rose 120 basis points, before restructuring charges.

  • Patent Activity: Colgate-Palmolive

    Patent Activity: Colgate-Palmolive

    December 6, 2016
    New oral care compositions, the use of radish root ferment filtrate in a cleanser and more.

  • Sparkle & Shine

    Sparkle & Shine

    Melissa Meisel, Associate Editor||November 21, 2016
    Glam packaging and upscale scent combos are big at Yankee Candle for Holiday 2016.

  • Cos Bar: Turning 40 and Hitting Fast Forward

    Cos Bar: Turning 40 and Hitting Fast Forward

    Christine Esposito, Associate Editor||November 21, 2016
    With a recent investor infusion, a new CEO and rebranding effort underway, this luxury beauty retailer has big plans.

  • The World Comes to Orlando

    The World Comes to Orlando

    Tom Branna , Editorial Director||December 1, 2016
    More than 1,600 chemists traveled to Florida for the IFSCC Congress

  • The Plex  Phenomenon

    The Plex Phenomenon

    Denise Costrini, Croda North America||December 1, 2016
    Croda details the hair-protecting qualities of bond multipliers and the company’s new bond-building formulation system.