Estée Lauder Posts Gain

Color cosmetics are still top sellers for The Estée Lader Companies. It posted net sales growth in nearly all product categories, geographic regions and channels for its second quarter ended Dec. 31, 2018. In fact, the company’s quarterly net sales exceeded $4 billion for the first time.


Net sales rose 7% to $4.01 billion and operating income rose 9% to $771 million. Net earnings nearly quadrupled, to $573 million compared to $123 million last year.


President and CEO Fabrizio Freda noted that the results marked ELC’s eighth consecutive quarter of impressive net sales growth that met or exceeded the company’s long-term goal, all while navigating many global macro issues.


“Our sustained progress is the result of our multiple engines of growth strategy, and demonstrates our agility in moving resources to the best global opportunities,” explained Freda, who noted that earnings per share in the second quarter grew more than twice the rate of net sales in constant currency, delivering an impressive first-half performance.”


With confidence in its continued ability to execute effectively and grow share in prestige beauty, while simultaneously making strategic investments in its business, Estée Lauder said it is raising net sales and EPS guidance for the year. The company now expects Q3 and full year net sales to increase between 5% and 6%.


“Our strongest growth engines this quarter included the skin care category globally, the Asia/Pacific region, the online and travel retail channels, and most brands, including Estée Lauder, La Mer, M•A•C and our artisanal fragrance brands,” said Freda.


The CEO insisted that despite a volatile and challenging backdrop, ELC remains optimistic about its long-term outlook.


“We are very well-positioned to build share in global prestige beauty,” Freda noted. “Leveraging savings generated by our Leading Beauty Forward initiative, we plan to increase our investments during the next six months behind our successful innovations, high-quality products, compelling digital advertising and effective commercial execution, while also enhancing our capabilities to strengthen our industry leadership and deliver long-term profitable growth.”