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Coty Inc. (NYSE: COTY) announced financial results for the fourth quarter and fiscal year ended June 30, 2013. For fiscal 2013, net revenues of $4.649 billion increased 2% like-for-like and 1% as reported. Adjusted net income of $323.2 million increased 7% from $300.7 million in the prior-year period. For the fourth quarter of 2013, Coty saw net revenues of $1.058 billion increased 4% like-for-like and 3% as reported, while an adjusted net income of $9.9 million increased from ($2.3) million in the prior-year period.
Commenting on the company's performance, Michele Scannavini, CEO of Coty Inc., said, "Coty delivered another year of positive financial performance. Our increase in net revenues was driven by growth in our fragrances and color cosmetics segments as well as positive developments across all regions, particularly the emerging markets. Operating and net income grew faster than revenues, contributing to margin expansion and demonstrating our ongoing focus on operational efficiency. We continue to show strong ability to convert earnings into cash, enabling us to keep investing to support our growth. We remain committed to our long-term strategy to grow revenues in line or faster than the markets and segments where we compete, and to grow earnings faster than sales, driving continuous margin expansion."
The net revenues increase was driven by solid increases in the color cosmetics and fragrances segments, with strong performance in Coty power brands Rimmel, Marc Jacobs, Chloe and Playboy. This growth was partially offset by lower net revenues in the skin and body care segment. By geographic region, all regions reflected higher net revenues at constant currency, led by Asia Pacific with 5% growth. Despite continued economic weakness in Southern European markets, at constant currency EMEA was 1% higher than the previous year.
For its fragrances division, Coty saw net revenue of $2.490 billion, a 2% reported increase over 2012's $2.452 billion. The increased net revenues reflected strong growth in power brands Marc Jacobs, Chloe and Playboy, bolstered by the success of new launches DOT Marc Jacobs, See by Chloe, and Playboy VIP. Also driving segment growth was the newly established brand Lady Gaga Fame and the strengthening of the Roberto Cavalli brand through new launches, including the extremely successful special edition fragrance for the Middle East, Roberto Cavalli Oud. Operating income for fragrances increased 9% to $369.7 million from $340.5 million in the prior year, resulting in 14.8% operating income margin, an improvement of 90 basis points versus fiscal 2012.
Color cosmetics's net revenue grew a reported 3% to $1.468 billion, above 2012's $1.430 billion. Growth in color cosmetics was primarily driven by the outstanding development of the Rimmel brand, gaining market share in the U.S. and Europe. Its double-digit growth was driven by a creative and successful innovation plan and a cutting edge marketing mix, with an innovative and engaging digital program.N.Y.C. New York Color and Manhattan, the company's entry price level brands, also contributed to the growth of the segment. Nail care brands OPI and Sally Hansen remained stable versus last year, and operating income for color cosmetics increased 4% to $208.8 million from $200.2 million in the prior year, resulting in 14.2% operating income margin, an improvement of 20 basis points compared to fiscal 2012.
For the skin and body care division, Coty reported $689.9 million in net revenue, down 4% from 2012's $727.9 million. Adidas net revenues were impacted by soft market conditions in Europe and the lack of mega promotions related to major sport events compared to the prior year, which benefitted from Euro Cup promotional activities. Adidas experienced strong double-digit growth in China, leveraging the TJoy production and distribution platform, which partially offset the decline experienced in the TJoy brand. Philosophy, after a slow start to the year, progressively recovered momentum in the second half of the fiscal year, as Coty's new innovation plan and international expansion started to kick in. Adjusted operating loss for skin and body care was $(5.7) million compared to $(4.8) million in the prior year, resulting in a decline in operating margin of 10 basis points.
In its outlook, Coty recognized that it has seen a deceleration of market growth in the U.S. and Europe, triggering significant trade de-stocking activity, particularly by U.S. mass retailers. As a consequence, Coty estimates net revenues in the first quarter of fiscal 2014 to marginally decline versus the prior year period. The company expects to return over the course of the fiscal year to its long term target to grow in line or faster than the markets and segments where it competes, when trade inventory is expected to normalize and the company's new investments in emerging markets will start to show positive impact on its growth.