Estee Lauder offers buyout to employees

Estee Lauder Co, Inc. is offering some U.S. employees voluntary buyouts as it works to improve profitability, a spokeswoman confirmed on yesterday. The company is facing pressure from competitors in lower-priced stores, such as Procter & Gamble Co.’s Olay products and Revlon Inc.’s new Vital Radiance line aimed at mature women. Last month, Estee Lauder said it would sell its Stila cosmetics brand and take other actions to improve profitability. The company has had four similar programs over the last 20 years, spokeswoman Sally Susman said. Estee Lauder, which is based in New York, has 24,000 employees worldwide. The offer was only made to the company’s employees in the United States. The company is also facing lost sales as its largest customer, Federated Department Stores Inc., closes stores more quickly than it previously thought following its acquisition of May Department Stores. Estee Lauder said last month that it expects Federated to close more than half of the 82 announced stores early in 2006 and said closures would cut reported earnings per share by 9 cents to 10 cents in its current fiscal year. The company said in October that it was taking steps that would result in savings of $40 million to $45 million in the current fiscal year, which ends June 30.