Beauty giant Coty reported another strong quarter with sales up 13 percent to USD 1.73 billion, on the back of surges in its prestige segment, and double-digit growth across all regions, including Asia Pacific.
For the second quarter ending December 31, Coty said its prestige segment revenues surged 17 percent to USD 1.12 billion, thanks to double-digit gains in both prestige fragrances and prestige makeup. The New York-based company’s consumer beauty segment increased 7 percent to USD 605 million, led by color cosmetics, mass fragrances and mass skincare.
By region, Asia Pacific net revenues reached USD 214 million, or 12 percent of Coty sales, up 15 percent as reported and 16 percent like for like (LFL).
The region’s performance was driven by double-digit percentage growth LFL in prestige sales, with double-digit percentage growth in several markets including Korea, Hong Kong and Taiwan, Australia and New Zealand, and regional travel retail.
In China, Coty’s prestige revenues grew by double-digit percentage in mainland China and more than three times in Hainan, while consumer beauty revenues were lower, said the company.
Net income decreased to USD 177.6 million from net income of $235.0 million in the prior year, driven by a higher fair value adjustment for Coty’s investment in Wella recorded in the prior year period.
“The strength of our Q2 and first half results reinforce several of our convictions, including the attractiveness of the beauty market, the continuing momentum of the fragrance index, the power of our brands, Coty’s transformed and industry-leading capabilities, our new ability to create blockbuster fragrance launches, and our disciplined financial execution,” said Sue Nabi, Coty CEO.
“First, the momentum of the global beauty market in the midst of geopolitical and macroeconomic disruptions confirms that consumers continue to gravitate to and prioritize beauty as a fundamental pillar of their well-being. Worldwide, consumers continue to purchase fragrances, cosmetics, skin and body care both as affordable luxuries and forms of self-expression. This is particularly true for mid to higher income consumers, resulting in the continued outperformance of luxury beauty. And they continue to engage with beauty both in-store and online, emphasizing the key role both channels play in the consumer journey.”
Earlier this week, Coty strengthened its leadership team with the announcement that Jean Holtzmann has been promoted to chief brands officer, Prestige. Holtzmann has been with Coty for seven years and has been instrumental in driving momentum at Hugo Boss as well as at the firm’s ultra-premium fragrance collections, according to the firm.
The company also announced this week a new licensing agreement with Marni for the Italian luxury label’s fragrance, as well as long term extensions of two of its key consumer beauty licenses, Bruno Banani and Mexx, respectively.