Coty Inc. reported a 10 percent increase in annual sales to USD 6.1 billion, despite a slowdown in growth in the fourth quarter, weighed down the divestiture of its Lacoste license and a slower market recovery in China.
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The owner of Max Factor and Rimmel brands said fourth-quarter sales growth slowed to 1 percent, after an 8 percent uptick in growth in the third quarter.
By region, Asia Pacific full-year revenue rose 9 percent to USD 766.1 million, up 11 percent like-for-like (LFL). However, Asia Pacific fourth-quarter sales declined 4 percent on a reported basis, which included a 2 percent headwind from foreign exchange, and declined 2 percent LFL.
On a reported basis in both periods, Asia excluding China and the travel retail channel grew by a mid-single-digit to double-digit percentage, while in China, fourth quarter sales were lower due to high prior-year comparisons and a very gradual market recovery there.
By category, prestige full-year revenues surged 13 percent to USD 3.9 billion, driven by a strong performance in Europe, the Middle East and Africa, Latin America, Asia excluding China and the travel retail channel.
Annual growth was, however, hindered by flat prestige sales growth of USD 802.8 million, which was impacted by a 4 percent negative headwind from the divestiture of the Lacoste license, said the New York-based licensor.
Prestige fragrance saw annual revenues grow by a double-digits, with the majority of Coty’s prestige fragrance brands reporting high-single-digit to a double-digit percentage growth. During the fourth quarter, the Prestige fragrance category growth remained strong across North America and Europe, with all major markets expanding led by the U.S., Canada, the U.K., Spain and Italy.
Travel retail continued to be strong with revenues up by double-digit percentage, with contributions from each region. Revenues for Coty’s prestige cosmetics business grew by a double-digits in the year, and a mid-single-digits in the fourth quarter, led by Burberry and Kylie Cosmetics.
Finally, consumer beauty sales rose 6 percent to USD 2.3 billion annually. In the fourth quarter, consumer beauty inched forward 2 percent to USD 560.6 million, supported by double-digit growth in mass fragrances and skin and body care, particularly in Brazil. The EMEA region delivered solid revenue growth in the quarter, coupled with strong growth across Latin America, Canada and Asia excluding China.
Brand bright spots included Beckham, Risque, Bruno Banani, Nautica, Bozzano and Paixao.
Full-year net income decreased to USD 76.2 million, from USD 495 million, a year earlier.
“Our FY24 results set a new milestone in Coty’s sustained track record of top-notch execution and market outperformance. In a dynamic macroeconomic backdrop, beauty maintains its privileged position, being neither a consumer goods industry nor a luxury goods industry,” said Sue Nabi, Coty CEO.
“We once again grew ahead of the underlying beauty market with 11 percent LFL growth compared to the beauty market growth of approximately 9 percent, fueled by our leadership in fragrances, strengthened performance in our core cosmetics business, and over-driving our growth channels, markets, and categories.”
Last month, Coty announced the launch of Max Factor in India, as it aims to expand in the country’s thriving beauty market.