Estée Lauder Companies’ Sales Rise 5%

Estée Lauder Companies reported strong financial results for the fiscal year ended June 30, 2017. Net sales rose 5% to $11.8 billion. Incremental sales from the company’s recent acquisitions of Too Faced and Becca contributed approximately 2 percentage points to reported sales growth.

“Throughout the fiscal year, our momentum accelerated, culminating in an outstanding fourth-quarter performance that completed another year of strong net sales and earnings per share growth,” said Fabrizio Freda, president and CEO. “These results reflect our success in pivoting our business to the fastest-growing areas of prestige beauty to align with consumers’ changing shopping preferences. With our leading brands, quality innovations and the acquisition of two makeup brands, we attracted new consumers globally.”

Lauder’s business accelerated in online direct-to-consumer and retailer e-commerce sites, as well as in the travel retail and specialty-multi channels, and the company built momentum in key geographies, like China and Italy, aided by enhanced digital and social media communications, according to Freda. In addition, Lauder began to improve its organizational efficiency and effectiveness through its Leading Beauty Forward initiative.

“Importantly, we delivered this performance in the face of external global volatility and one of the biggest moments of change in our industry,” said Freda.

He expects the momentum to continue in fiscal 2018.

“We are well-positioned to deliver strong profitable growth as we deploy our prestige brand portfolio to new consumers globally through our hero product franchises and robust new product pipeline, new digital-first marketing approach, and focused expansion for our smaller to mid-sized brands.”

For the three months ended June 30, 2017, sales rose 9% to $2.89 billion. The acquisitions of Too Faced and Becca performed ahead of plan with incremental sales contributing approximately 3.5 percentage points of the reported sales growth, according to ELC. The company posted sales growth in most brands and across-the-board sales gains in all geographic regions and product categories, except hair care.

Q4 sales benefitted from new products and double-digit growth in several developed and emerging markets, particularly China. The company also generated double-digit gains in its travel retail, online and specialty-multi channels.