Estée Lauder has announced its first quarter 2022 results, which showed net sales were $4.39 billion, a 23% increase from $3.56 billion in the previous year.
Net earnings were $692 million, compared to $523 million in the previous year.
Total reported operating income was $935 million, a 33% increase from $705 million in the previous year.
UPDATE:In an analyst call, Tracey Travis, the company's executive vice president and CFO said, "[W]e take pricing every year usually in the 2% to 2.5% range. We are taking approximately 3% of pricing this year. And yes, it is certainly considering the inflationary environment that we're operating in. We do take differential pricing."
Travis added, "So that is an average across all of our markets, all of our brands. So there's no specific category that we're taking any more pricing in than others, but it is tiered certainly by the tiering of our brand portfolio."
"I just want to add, we do have the ability to price where there is the opportunity," said Fabrizio Freda, the company's president and CEO. "And because of our loyalty, activity levels, etc., obviously, in certain markets with spaces. And so we are planning because of the current inflationary environment ... to take about half a point more prices than in the previous years, and this is completely justified. And this, combined with our cost-saving programs, which should allow us to manage the inflation without any negative impact, neither of our advertising nor on our profitability, and that's our plan."
The skin care category reported net sales of $2,449 million, compared to $2,035 million the previous year.
The makeup category reported net sales of $1,174 million, compared to $978 million the previous year.
The fragrance category reported net sales of $609 million, compared to $406 million the previous year.
The hair care category reported net sales of $148 million, compared to $136 million the previous year.
Q2 2022 Forecast
Net sales are forecast to increase between 11% and 13% compared to the previous year.
Fabrizio Freda, president and CEO said:
We delivered excellent performance to begin fiscal 2022, despite the increased volatility and variability globally during the quarter, by virtue of our dynamic multiple engines of growth strategy. Our growth engines increasingly diversified, as we expected. Makeup, developed markets in the West, and brick-and-mortar reignited and complemented momentum in skin care, fragrance, mainland China, travel retail in Asia/Pacific, and global online. Impressively, relative to the pre-pandemic first quarter of fiscal 2020, the overall business is much bigger and more profitable.
Thirteen brands contributed double-digit organic sales growth versus the prior-year period, demonstrating the breadth of strength across our portfolio. Estée Lauder and M·A·C drove Makeup’s emerging renaissance, while La Mer and Clinique delivered stand-out results in skin care. fragrance soared double-digits in every region, driven by Tom Ford Beauty and Jo Malone London. Our hero products performed exceptionally well and our innovation proved, once more, to uniquely capture consumer desires.”