07.02.23
New York, NY
www.elcompanies.com
Sales: $17.7 billion
Key Personnel: William P. Lauder, executive chairman; Fabrizio Freda, president and chief executive officer; Roberto Canevari, executive vice president, global supply chain; Stéphane de La Faverie, executive group president; Carl Haney, executive vice president, research, product and innovation officer; Jane Hertzmark Hudis, executive group president; Peter Jueptner, president, international; Jane Lauder, executive vice president, enterprise marketing and chief data officer; Leonard A. Lauder, chairman emeritus; Ronald S. Lauder, chairman, Clinique Laboratories LLC; Sara Moss, vice chairman; Michael O’Hare, executive vice president, global human resources; Deirdre Stanley, executive vice president and general counsel; Tracey T. Travis, executive vice president and chief financial officer
Major Products: Cosmetics, skin care, fragrances and hair care. Brands include Aerin Beauty, Aramis, Aveda, Bobbi Brown, Bumble and Bumble, Clinique, Darphin Paris, Dr.Jart+, Editions de Parfums Frederic Malle, Estée Lauder, GlamGlow, Jo Malone London, Kilian Paris, La Mer, Lab Series, Le Labo, MAC, Niod, Origins, Smashbox, The Ordinary, Tom Ford Beauty, Too Faced
New Products: Skincare—La Mer Hydrating Infused Emulsion, Clinique Smart Clinical Repair Wrinkle Correcting Serum; Makeup—Too Faced Crowd Crush Blush and Cheek Popper; MACStack mascara, Estée Lauder Double Wear Sheer Long-Wear Makeup, Clinique/Kate Spade New York lip color (limited edition); Fragrance—Jo Malone House of Roses and the Blossoms Collection, Thé Matcha 26; Haircare— Aveda Botanical Repair Strengthening Overnight Serum, Bumble and Bumble Thickening Plumping Mask and Thickening Go Big Plumping Treatment. Acquisition—Tom Ford Beauty. To be launched: Balmain Beauty (2024).
Comments: Sales rose 4% in fiscal 2022. Net earnings fell more than 14% to about $2.4 billion. The company blamed the decline, in part, on restructuring charges.
By segment, skin care sales rose 4% to nearly $9.9 billion. Skin care net sales grew in The Americas, which was offset by a decline in the EMEA region. Net sales growth from La Mer, Clinique and Bobbi Brown was offset by a decline from Estée Lauder. Double-digit growth from La Mer was driven by strength among Chinese consumers in both mainland China and travel retail. Net sales growth reflected increases in hero products, including Crème de la Mer and the upgrade to The Treatment Lotion. The Hydrating Infused Emulsion intro and the launch on a new online platform in mainland China, also contributed to growth.
Clinique net sales growth was driven by strong demand for its hero products, including the Take The Day Off line of products and Even Better Clinical Radical Dark Spot Corrector + Interrupter, as well as the launch of Smart Clinical Repair Wrinkle Correcting Serum. Bobbi Brown delivered double-digit skin care net sales growth in every region, led by robust demand from Chinese consumers. Net sales growth reflected increases in hero products, including Soothing Cleansing Oil and Vitamin Enriched Face Base. Successful performance during holiday and key shopping moments, as well as targeted consumer reach also contributed to growth.
Estée Lauder skin care net sales declined, reflecting challenges in the second half of fiscal 2022 due to the resurgence of covid-19 cases in Asia that led to increased restrictions. Estée Lauder was disproportionately impacted by temporarily reduced capacity at Shanghai distribution facilities in Q4.
Makeup sales increased 11% to $4.6 billion. Sales increased across brands, led by MAC and Estée Lauder. By region, Europe and North America led gains. MAC’s double-digit net sales growth was driven by hero products, such as Studio Fix, the launch of MACStack mascara, and successful social media campaigns to drive the makeup renaissance. Double-digit net sales growth from Estée Lauder was fueled by the Double Wear and Futurist foundation product lines, as well as the successful launch of Double Wear Sheer Long-Wear Makeup.
Fragrance sales soared 30% to $2.5 billion, driven by gains in every region and every fragrance brand. Leading the way were Jo Malone London, Tom Ford Beauty and Le Labo. Jo Malone London’s sales grew strong double digits, driven by strength in colognes. Bath & Body and Home also delivered strong growth reflecting consumer habits developed during the pandemic.
Tom Ford Beauty grew strong double digits, reflecting strength in its Signature and Private Blend fragrances. The launch of Ombre Leather Parfum also contributed to growth.
Net sales from Le Labo rose strong double digits with growth in all regions, reflecting the recovery of brick-and-mortar, improved retail traffic and targeted expanded consumer reach. Growth was driven by hero fragrances, such as Santal 33, as well as the successful launch of Thé Matcha 26.
Hair care sales increased 11% to $631 million. The company said sales rose in every region, due to sales gains for Aveda and Bumble and Bumble. The reemergence of brick-and-mortar helped too. Hair care net sales rose across every region. Aveda’s growth was attributed to its hero franchises, including Botanical Repair and Nutriplenish, as well as the relaunch of Full Spectrum Semi-Permanent Treatment Hair Color and the launch of Botanical Repair Strengthening Overnight Serum.
Double-digit net sales growth at Bumble and Bumble came from growth in hero franchises and the launches of Thickening Plumping Mask and Thickening Go Big Plumping Treatment. Targeted expanded consumer reach also contributed to growth, according to ELC.
“Other” product sales rose 9% to $45 million.
By region, Sales in the Americas jumped 22%, EMEA increased 11%, but Asia/Pacific declined 9%.
Gains in the Americas were attributed to strong double digits in the US, Canada and Latin America on the strength of the brick-and-mortar recovery. Sales increased in every product category and in nearly every distribution channel.
In EMEA, net sales grew in nearly every market, led by the UK. The growth reflects strong double-digit recovery in brick-and-mortar.
Covid-19 disrupted sales in Asia/Pacific. ELC said net sales growth in more than half of the markets in the region was offset by increased covid-19 restrictions during the second half of fiscal 2022. Mid-single-digit growth in the first nine months of the fiscal year was offset by the negative impacts from the increased covid-related restrictions in China in the fourth quarter, including the temporarily reduced capacity at the Company’s distribution facilities in Shanghai Net sales declines in makeup and skin care were only partly offset by net sales growth from fragrance and hair care in the region.Net sales declined in brick-and-mortar.
“This evolution further positions The Estée Lauder Companies’ brands to win with consumers in a complex and continuously changing beauty landscape, while elevating our internal talent bench and organizational planning to position us well to deliver on the company’s long-term strategy with agility,” said CEO Fabrizio Freda.
In September 2022, ELC entered into a licensing agreement with Balmain to create Balmain Beauty, a line of luxury beauty products. It will debut in 2024.
A decline in its Asia travel business continues to put a drag on ELC sales. For Q3 ended March 31, 2023, sales fell 12%. For the nine months, sales fell 13% to $12.3 billion. Net earnings fell 56% to $1.04 billion. Despite the results, ELC expects organic net sales to return to growth in the fourth quarter, reflecting continued momentum of post-covid recovery growth in nearly all markets globally. The impacts from the ongoing pressures in Asia travel retail, driven primarily by risks associated with the volatile and slower than originally anticipated pace of recovery, will partially offset growth in other markets.
In April, ELC completed the $2.25 billion acquisition of the Tom Ford brand. For a few days in May, rumors swirled that the ELC c-suite was headed for a shakeup. At the time, billionaire investor Nelson Peltz was said to be demanding changes at the top. After the brief dustup, all seems quiet on the Lauder front. On June 9, MAC Cosmetics launched its Day of Giving. To raise funds for its Viva Glam Campaign, 100% of all lipstick sales will benefit LGBTQ and women’s rights organizations.
www.elcompanies.com
Sales: $17.7 billion
Key Personnel: William P. Lauder, executive chairman; Fabrizio Freda, president and chief executive officer; Roberto Canevari, executive vice president, global supply chain; Stéphane de La Faverie, executive group president; Carl Haney, executive vice president, research, product and innovation officer; Jane Hertzmark Hudis, executive group president; Peter Jueptner, president, international; Jane Lauder, executive vice president, enterprise marketing and chief data officer; Leonard A. Lauder, chairman emeritus; Ronald S. Lauder, chairman, Clinique Laboratories LLC; Sara Moss, vice chairman; Michael O’Hare, executive vice president, global human resources; Deirdre Stanley, executive vice president and general counsel; Tracey T. Travis, executive vice president and chief financial officer
Major Products: Cosmetics, skin care, fragrances and hair care. Brands include Aerin Beauty, Aramis, Aveda, Bobbi Brown, Bumble and Bumble, Clinique, Darphin Paris, Dr.Jart+, Editions de Parfums Frederic Malle, Estée Lauder, GlamGlow, Jo Malone London, Kilian Paris, La Mer, Lab Series, Le Labo, MAC, Niod, Origins, Smashbox, The Ordinary, Tom Ford Beauty, Too Faced
New Products: Skincare—La Mer Hydrating Infused Emulsion, Clinique Smart Clinical Repair Wrinkle Correcting Serum; Makeup—Too Faced Crowd Crush Blush and Cheek Popper; MACStack mascara, Estée Lauder Double Wear Sheer Long-Wear Makeup, Clinique/Kate Spade New York lip color (limited edition); Fragrance—Jo Malone House of Roses and the Blossoms Collection, Thé Matcha 26; Haircare— Aveda Botanical Repair Strengthening Overnight Serum, Bumble and Bumble Thickening Plumping Mask and Thickening Go Big Plumping Treatment. Acquisition—Tom Ford Beauty. To be launched: Balmain Beauty (2024).
Comments: Sales rose 4% in fiscal 2022. Net earnings fell more than 14% to about $2.4 billion. The company blamed the decline, in part, on restructuring charges.
By segment, skin care sales rose 4% to nearly $9.9 billion. Skin care net sales grew in The Americas, which was offset by a decline in the EMEA region. Net sales growth from La Mer, Clinique and Bobbi Brown was offset by a decline from Estée Lauder. Double-digit growth from La Mer was driven by strength among Chinese consumers in both mainland China and travel retail. Net sales growth reflected increases in hero products, including Crème de la Mer and the upgrade to The Treatment Lotion. The Hydrating Infused Emulsion intro and the launch on a new online platform in mainland China, also contributed to growth.
Clinique net sales growth was driven by strong demand for its hero products, including the Take The Day Off line of products and Even Better Clinical Radical Dark Spot Corrector + Interrupter, as well as the launch of Smart Clinical Repair Wrinkle Correcting Serum. Bobbi Brown delivered double-digit skin care net sales growth in every region, led by robust demand from Chinese consumers. Net sales growth reflected increases in hero products, including Soothing Cleansing Oil and Vitamin Enriched Face Base. Successful performance during holiday and key shopping moments, as well as targeted consumer reach also contributed to growth.
Estée Lauder skin care net sales declined, reflecting challenges in the second half of fiscal 2022 due to the resurgence of covid-19 cases in Asia that led to increased restrictions. Estée Lauder was disproportionately impacted by temporarily reduced capacity at Shanghai distribution facilities in Q4.
Makeup sales increased 11% to $4.6 billion. Sales increased across brands, led by MAC and Estée Lauder. By region, Europe and North America led gains. MAC’s double-digit net sales growth was driven by hero products, such as Studio Fix, the launch of MACStack mascara, and successful social media campaigns to drive the makeup renaissance. Double-digit net sales growth from Estée Lauder was fueled by the Double Wear and Futurist foundation product lines, as well as the successful launch of Double Wear Sheer Long-Wear Makeup.
Fragrance sales soared 30% to $2.5 billion, driven by gains in every region and every fragrance brand. Leading the way were Jo Malone London, Tom Ford Beauty and Le Labo. Jo Malone London’s sales grew strong double digits, driven by strength in colognes. Bath & Body and Home also delivered strong growth reflecting consumer habits developed during the pandemic.
Tom Ford Beauty grew strong double digits, reflecting strength in its Signature and Private Blend fragrances. The launch of Ombre Leather Parfum also contributed to growth.
Net sales from Le Labo rose strong double digits with growth in all regions, reflecting the recovery of brick-and-mortar, improved retail traffic and targeted expanded consumer reach. Growth was driven by hero fragrances, such as Santal 33, as well as the successful launch of Thé Matcha 26.
Hair care sales increased 11% to $631 million. The company said sales rose in every region, due to sales gains for Aveda and Bumble and Bumble. The reemergence of brick-and-mortar helped too. Hair care net sales rose across every region. Aveda’s growth was attributed to its hero franchises, including Botanical Repair and Nutriplenish, as well as the relaunch of Full Spectrum Semi-Permanent Treatment Hair Color and the launch of Botanical Repair Strengthening Overnight Serum.
Double-digit net sales growth at Bumble and Bumble came from growth in hero franchises and the launches of Thickening Plumping Mask and Thickening Go Big Plumping Treatment. Targeted expanded consumer reach also contributed to growth, according to ELC.
“Other” product sales rose 9% to $45 million.
By region, Sales in the Americas jumped 22%, EMEA increased 11%, but Asia/Pacific declined 9%.
Gains in the Americas were attributed to strong double digits in the US, Canada and Latin America on the strength of the brick-and-mortar recovery. Sales increased in every product category and in nearly every distribution channel.
In EMEA, net sales grew in nearly every market, led by the UK. The growth reflects strong double-digit recovery in brick-and-mortar.
Covid-19 disrupted sales in Asia/Pacific. ELC said net sales growth in more than half of the markets in the region was offset by increased covid-19 restrictions during the second half of fiscal 2022. Mid-single-digit growth in the first nine months of the fiscal year was offset by the negative impacts from the increased covid-related restrictions in China in the fourth quarter, including the temporarily reduced capacity at the Company’s distribution facilities in Shanghai Net sales declines in makeup and skin care were only partly offset by net sales growth from fragrance and hair care in the region.Net sales declined in brick-and-mortar.
Fiscal 2023 Results
In August 2022, ELC announced an organizational evolution across its brand portfolio to strategically position the company for long-term, sustainable growth in a fast-paced evolving global landscape. Effective September 1, the company’s brand portfolio evolved into two brand clusters led by Jane Hertzmark Hudis, executive group president, and Stéphane de La Faverie, who has been promoted to executive group president. The move was designed to ensure continued portfolio-wide alignment, enabling the business to focus on the greatest areas of opportunity. Both continue to report directly to Freda.“This evolution further positions The Estée Lauder Companies’ brands to win with consumers in a complex and continuously changing beauty landscape, while elevating our internal talent bench and organizational planning to position us well to deliver on the company’s long-term strategy with agility,” said CEO Fabrizio Freda.
In September 2022, ELC entered into a licensing agreement with Balmain to create Balmain Beauty, a line of luxury beauty products. It will debut in 2024.
A decline in its Asia travel business continues to put a drag on ELC sales. For Q3 ended March 31, 2023, sales fell 12%. For the nine months, sales fell 13% to $12.3 billion. Net earnings fell 56% to $1.04 billion. Despite the results, ELC expects organic net sales to return to growth in the fourth quarter, reflecting continued momentum of post-covid recovery growth in nearly all markets globally. The impacts from the ongoing pressures in Asia travel retail, driven primarily by risks associated with the volatile and slower than originally anticipated pace of recovery, will partially offset growth in other markets.
In April, ELC completed the $2.25 billion acquisition of the Tom Ford brand. For a few days in May, rumors swirled that the ELC c-suite was headed for a shakeup. At the time, billionaire investor Nelson Peltz was said to be demanding changes at the top. After the brief dustup, all seems quiet on the Lauder front. On June 9, MAC Cosmetics launched its Day of Giving. To raise funds for its Viva Glam Campaign, 100% of all lipstick sales will benefit LGBTQ and women’s rights organizations.
The Estée Lauder Companies’ R&D teams regularly present research at leading scientific conferences around the world. Most recently, scientists from ELC and the Estée Lauder, Aveda and Lab Series brands presented data that provides new insights in priority areas of skin care and hair care at the 2023 Meeting of the International Societies of Investigative Dermatology (ISID) in Tokyo, Japan. Skin hydration, oxidative damage, scalp aging, men’s skin care, and new clinical methods for assessing treatments for UV damage are among some of the priority areas of research for ELC that were presented by ELC’s scientists at ISID. “At ELC, we continue to take a multidisciplinary scientific approach to skin and hair care, utilizing knowledge and advancements from across industries and the scientific community,” said Dr. Bhushan Hardas, senior vice president, Advanced Technologies. “Our commitment to new science spans biological, material and chemical research, as well as rigorous safety, in vitro and clinical testing in the development of cutting-edge technologies.” This month, ELC’s R&D experts will be in Singapore for the 25th World Congress of Dermatology (WCD). ELC researchers across three brands and ELC R&D will share novel clinical and preclinical results that demonstrate scientific innovation and leadership across emerging areas of skin health and anti-aging in the form of five poster presentations and a satellite symposium during this global event, which takes place every four years. |