The most vital three months of the yr—retail’s so known as “golden quarter” within the lead-in to the vacations—had been resilient for magnificence powerhouses Estée Lauder and L’Oréal Group. Both delivered respective gross sales development of 14% to $5.5 billion, and 15.4% to €9.1 billion ($10.3 billion).
The strongest product section for the American multinational—whose high-end manufacturers embody Jo Malone London, La Mer, Le Labo, and Tom Ford—proved to be perfume. Scents grew by 29%—double the common tempo of the corporate in the course of the interval—to succeed in $800 million. Increases had been seen in each area, pushed by gross sales of luxurious fragrances.
France’s L’Oréal breaks down its gross sales in another way: by enterprise division. While the smaller (comparatively talking) specialist Active Cosmetics and Professional Products segments grew quickest at 28% and 18.5% to €990 million and €1,060 million respectively, it was L’Oréal Luxe that garnered essentially the most consideration. Its improve of 16.5% within the three months to December 2021 pushed gross sales to a whopping €3.75 million. The division additionally delivered the best working revenue over the complete yr of €2.8 billion.
A luxurious and perfume candy spot
Commenting on the section’s efficiency throughout 2021 as an entire, Nicolas Hieronimus, L’Oréal Group’s CEO, stated: “L’Oréal Luxe turned the group’s largest division, with exceptional success in fragrances.” L’Oréal Luxe has been consolidated its management in fragrances, helped by established icons like Libre by Yves Saint Laurent, launches like Alien Goddess from Thierry Mugler, who just lately died, and Prada’s Luna Rossa Ocean Prada.
At the top of 2021, the division additionally finalized the acquisition of Youth To The People, bolstering its skincare part, which is more likely to see a comeback in 2022 as COVID restrictions proceed to be lifted and precise sampling and testing turns into normalized once more.
Despite sharp improve in perfume gross sales for Estée Lauder in 2021’s remaining quarter, skincare’s stable development of 12% pushed its gross sales previous $3 billion (to $3.16 billion), pushed by La Mer and Clinique. The surges for each manufacturers mirrored will increase in hero merchandise corresponding to The Treatment Lotion, Crème de la Mer, Genaissance, and Clinique’s Even Better Clinical Radical Dark Spot Corrector and Take The Day Off Balm, in addition to new launches.
Lauder is banking on China for skincare to carry out forward of magnificence general. In an investor name, Fabrizio Freda, President and CEO of The Estée Lauder Companies, informed analysts: “Mainland China delivered excessive single-digit gross sales development, a formidable consequence given the regional restrictions within the quarter that pressured brick-and-mortar and make-up. However, skincare and perfume grew double-digits in Mainland China.”
An American dream
Regionally, it was the Americas that registered the best development for each corporations. Lauder noticed a 19% hike throughout the entire area, whereas L’Oréal noticed the identical tempo set in North America.
According to NPD knowledge, status was the place it was at within the US market final yr, with a 30% year-over-year improve in greenback gross sales to $22 billion, led by perfume development of 49%. The weakest section was skincare, up 18%.
Looking forward to 2022, each corporations are bullish, regardless that COVID stays a menace. L’Oréal’s Hieronimus maintains that L’Oréal “gained market share in all zones, divisions and classes” final yr, which places it in a robust place. “We are assured in our capacity to outperform the market in 2022 and obtain one other yr of development in each gross sales and earnings,” he added.
Freda stated: “Our enterprise is way larger and extra worthwhile than pre-pandemic, with each area bigger. This reinforces our confidence to navigate the impacts of the extended pandemic. We are elevating our fiscal 2022 full yr outlook.” Lauder’s fiscal yr ends in June.
In the markets, neither Paris-listed L’Oréal nor Estée Lauder’s share costs have fared effectively this yr, each down about 14-15% previously three months. However, over the previous 12 months, Lauder is up by 6% and L’Oréal by 14%.
https://beautymatter.com/articles/fragrance-and-high-end-beauty-drive-gains-for-estee-lauder-and-loreal
