For its first quarter ended Sept. 30, 2011, The Estée Lauder Companies Inc. reported net sales of $2.48 billion, an 18% increase compared with $2.09 billion reported in the prior-year quarter. Excluding the impact of foreign currency translation, net sales increased 14% from a year ago. The company also reported net earnings for the quarter of $278.6 million, a 46% increase compared with $191.1 million last year.
Fabrizio Freda, Estée Lauder president and CEO, said, "Our very strong company performance continued to be broad-based, highlighted by healthy top line growth across all categories and regions, strong bottom line growth and continued margin expansion. These results reflect the strength of our brands, the appeal of our superior product innovations, and the effectiveness of our focused advertising and marketing spending. The recent economic uncertainty and financial market volatility have not significantly impacted our business. The strength of our underlying fundamentals, our winning strategy and the increasing efficiency of our business model enabled us to significantly outperform the beauty industry and continue to report exceptional results. As we move forward in this environment, we believe the strategies we have implemented better position us for sustained growth and increased profitability. We plan to leverage the strength of our brand portfolio and formidable creativity to capture share and maximize growth for the long term.”
The company's strong performance was due to solid overall business, particularly from its largest brands, helped by a weaker U.S. dollar. The company grew double-digits in every region, including the U.S., its home market. Sales also increased in virtually all product categories within each region. Sales growth was particularly strong in travel retail and emerging markets, along with solid gains in many developed countries.
In the skin care category, which is a strategic priority for Estée Lauder, the company saw net sales of over $1 billion for the quarter, up 25% over the same quarter in 2010. In makeup, the company grew the category’s net sales 17% over last year’s same quarter, to $928.8 million. This growth reflected strong increases, primarily from the company's makeup artist brands and certain heritage brands. In fragrance, the company saw net sales of $356.8 million, an increase of 7% over 2010, and the hair care category increased its net sales 10% over 2010 to $103.8 million.
Geographically, the Americas region saw net sales of $1.1 billion in the quarter, up 11% from last year and primarily attributable to higher sales in the U.S., which benefited from a solid retail environment in the prestige area and winning new product offerings. The improvement also reflects strong growth from the company's heritage brands and makeup artist brands. Sales also increased in Canada. The higher sales also reflect strong double-digit gains in Latin America, which benefited from growth in emerging markets, such as Brazil. And sales of the company's products online increased double digits and its sales to department stores continued to grow, also at double-digit rates.
In the Europe, Middle East and Africa region, the company recorded net sales of $858.2 million, a 26% increase. The company's travel retail business continued to generate strong double-digit net sales growth in the quarter, resulting from successful product launches and increased distribution. This reflects both an improvement in global airline passenger traffic, particularly in Asia, and stronger conversion of travelers into purchasers, driven by improved marketing and distribution. The U.K., Germany, Italy and the Middle East posted the highest results. Partially offsetting the overall growth were lower results in Russia, primarily reflecting an increase in strategic investment spending. And in the Asia region, net sales of $512.4 were recorded, a 24% increase over 2010. The strongest gains were generated in China, Hong Kong, Korea, Taiwan and Thailand, primarily reflecting strong sales of skin care and makeup products, while Japan and Australia did not report sales increases.
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