(AOF) – For its 2022/2023 fiscal year, Estée Lauder reported annual net income of $1.01 billion, compared to net income of $2.39 billion the previous year. Diluted net earnings per common share were $2.79, compared to $6.55 a year earlier. The cosmetics group posted net sales of $15.91 billion for its fiscal year ended June 30, 2023, down 10% from $17.74 billion the previous year.
Organic net revenue decreased 6%, primarily due to Asia travel retail in Hainan and Korea, partially offset by growth in nearly all markets in Asia/Pacific and South America. Europe, Middle East and Africa (“EMEA”).
In contrast, the company’s total net organic revenue in emerging markets and in the fragrance business grew by double digits.
The reported and adjusted declines include an unfavorable impact of 5% and 4%, respectively, from certain foreign currency transactions at major international travel retail sites.
For 2023/2024, Estée Lauder estimates that reported net sales are expected to increase 5-7% from the prior year. Diluted net earnings per common share are expected to be between $3.43 and $3.70.
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Market boom for several more years
According to Bain & Company, the global luxury market (fashion, cars, hotels, wines and spirits, cruises, etc.) will have recorded a 21% jump in sales in 2022, to 1,384 billion euros. The luxury personal products segment (jewellery, clothing, watches, leather goods, etc.) should grow by 22% and again grow by 3% to 8% in 2023 despite the expected economic slowdown. Growth should continue in the following years, with an increase that should reach 60% by 2030! According to Bain, spending by Americans in Europe has more than doubled between 2019 and 2022. This development is largely explained by a strong dollar. The Chinese market, on the other hand, is at half mast due to the “zero Covid” policy and strict confinements.