Estée Lauder Ltd. sales and profits fall in fiscal year ending June 2023 Fragrances do well, but travel retail slumps

Estée Lauder Companies’ sales for the fiscal year ending June 2023 (July 2022 to June 2023) were US$15.91 billion, a year-on-year decrease of 10%, a complete reversal from the previous year’s record sales of US$2.32 million. trillion yen), operating income fell 52% year-on-year to US$1.509 billion (approximately 220.036 billion yen), and net profit fell 58% year-on-year to US$1.01 billion (approximately 147.2 billion yen) (approximately 74 million yen). While we achieved sales growth in our existing businesses and increased share of premium beauty in both developed and emerging markets, travel retail in Asia was weak, particularly in the high-margin skincare segment, with a slower-than-expected recovery in China, Sales in North America also grew slowly. The market struggled as the environment continued to be weak. Fragrances, on the other hand, posted double-digit growth in all regions, while color cosmetics, which continues to struggle, also posted double-digit year-over-year growth in the fourth quarter (April 2023 to June 2023), indicating that fragrance Business achieved double-digit growth in all regions. recover. Sales include the impact of the termination of certain designer brand licenses in FY2022, royalty income related to the acquisition of TOM FORD, and the negative impact of currency translation.

Sub-category sales, driven by TOM FORD BEAUTY, ESTÉE LAUDER and LE LABO, maintained double-digit growth in all regions, reaching US$2.512 billion (approximately 366.256 billion yen), a year-on-year increase of 16%. In terms of skin care products, La Mer (formerly De La Mer, renamed in July), Estee Lauder, and Dr. 8.202 billion US dollars (approximately 1.1959 trillion yen). On the other hand, “BOBBI BROWN” and “M·A·C (Color Art Cosmetics)” and “The Ordinary” performed well with double-digit growth in all regions. In the makeup category, MAC and Clinique performed well, but La Mer, Estee Lauder, and Tom Ford Beauty performed sluggishly (44 million yen). Hair care sales rose 3% to $653 million (approximately 95.2 billion yen) due to growth in The Ordinary and AVEDA.

Divided by region, cosmetics sales in all regions of EMEA achieved double-digit growth, and emerging markets led by India also achieved double-digit growth, down 19% to 6.225 billion US dollars (907.624 billion yen). In the United States, although Latin America recorded double-digit growth, the pace of improvement in retail stores (mainly skin care products) was slower than expected, and some retail stores tightened their inventories. JPY). Most of the Asia-Pacific region eased restrictions in the fourth quarter, with a strategic focus on luxury fragrances and skincare. Hong Kong Special Administrative Region, Macau Special Administrative Region, Mainland China, Australia and Japan were the main drivers of sales growth, but overall sales fell 4% to US$5.194 billion (approximately 757.3 billion yen).

For the full year 2024, sales are expected to grow 5-7% year-over-year. First, we plan to return sales to growth and margins over the next few years, and we plan to continue making strategic investments in areas that support long-term profit growth. These investments include innovation and advertising in Asia, travel retail, growth in emerging markets and the opening of Asia’s first manufacturing facility in Japan to support growth in the Asia Pacific region.