Estee Lauder’s share price climbs as it grows sales
Beauty group Estee Lauder Companies' share price climbed four per cent as it reported strong sales in its second quarter results.
The figures
The company – which owns brands such as MAC, Clinique and Bobbi Brown – reported net sales of $3.21bn (£2.56bn) for the quarter ending 31 December, up three per cent as compared to the same quarter the year before.
Read more: Estee Lauder looks well made-up as restructuring plans roll on
Net earnings fell, however, down from $447m to $428m, a drop of 4.25 per cent. Earnings per share fell from $1.19 to $1.15, which the company said was in part due to its restructuring.
Restructuring costs and other charges came to $41m.
Why it's interesting
Estee Lauder Companies announced plans to restructure the business last year under the banner 'Leading Beauty Forward'. Under the plans, it said it would be cutting around 900 to 1,200 jobs globally, or roughly 2.5 per cent of its workforce.
Of the group's brands, La Mer, Tom Ford, and Jo Malone performed particularly well. The company said both its Tom Ford make-up and La Mer skin care achieved double digit growth in every region the company operates in.
However, Clinque and MAC sales held the group back, in part due to lower footfall in US department stores.
What Estee Lauder said
Fabrizio Freda, president and chief executive of the Estee Lauder companies, said: "Our second quarter sales growth accelerated as planned, reflecting the benefits of our portfolio diversity by brand, channel, product category and country.
"Our small, mid-sized and luxury brands continued to lead growth, contributing strong sales increases, and recent acquisitions added incremental sales.
"Additionally, among our large brands, Estee Lauder and MAC each grew in constant currency."