President and CEO Fabrizio Freda: “Our outstanding performance… demonstrates that we have the right strategies, product innovation and high-touch services in place for continued profitable growth” |
US. The Estée Lauder Companies delivered a strong performance during the second quarter ended 31 December. Net sales reached US$2.49 billion, a +10% increase compared with the US$2.26 billion reported in the prior year. Excluding the impact of foreign currency translation, net sales increased +11%.
Net earnings for the quarter reached US$343.9 million, a +34% increase from US$256.2 million the previous year. Diluted net earnings per common share also rose +34% to US$1.71, compared with US$1.28 the year before.
President and CEO Fabrizio Freda commented: “Our outstanding performance this holiday season demonstrates that we have the right strategies, product innovation and high-touch services in place for continued profitable growth. Consumers’ appetite for our brands was fantastic and garnered strong sales and profit gains. We successfully leveraged our broad-based growth with meaningful improvements in operating margin over the prior-year quarter.”
He added: “As we continue our strategic journey, we are learning what has worked and what needs refinement. Throughout the year we will invest more resources in those areas that are winning and capable of generating sustainable, profitable growth. Our company’s second-quarter results cap a strong fiscal 2011 first half, and we believe we are well positioned to achieve another successful year. This gives us the confidence to raise our full-year diluted earnings per share estimate range to US$3.40 to US$3.60, as well as increase our fiscal 2013 operating margin target to 13-14%.”
A strong holiday performance helped bolster second-quarter results, as did a weaker US Dollar. The Company posted sales gains in each of its geographic regions and product categories. Sales growth was led by the international businesses, particularly travel retail and emerging markets.
Travel retail performed particularly well within the Europe/Middle East/Africa region, where it generated “significant net sales and profit growth” during the quarter, according to the group.
This growth was attributed to successful product launches, increased distribution and cost containment. An improvement in global airline passenger traffic and stronger conversion of shoppers into buyers was another driver.
For the six months ended 31 December the Lauder group reported net sales of US$4.58 billion, a +12% increase from the US$4.10 billion in the comparable prior-year period. Excluding the impact of foreign currency translation, net sales increased +13%. Net earnings for the half-year reached US$535.0 million, a +35% increase from the US$396.9 million the previous year.