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Coty profit and sales rise as prestige beauty leads growth

Sophie Smith
08 February 2024

Coty has reported a 13% increase in sales to £1.3 billion ($1.7 billion) for the second quarter ending 31 December 2023, revealing double-digit growth across its prestige beauty division.

The company also delivered low-single-digit percentage volume growth, high-single-digit percentage pricing contribution, and low-single-digit percentage benefit from mix during the period.

The prestige division saw revenues increase 17% in the second quarter, with growth from fragrance, cosmetics and skincare.

Prestige fragrance was driven by Hugo Boss, Calvin Klein, Gucci, Chloé and Marc Jacobs, whilst cosmetics was helped by Kylie, Burberry and Gucci, and skincare by Lancaster and Philosophy.

The consumer beauty division achieved revenue growth of 7%, led by colour cosmetics alongside mass fragrance, skincare and bodycare.

Coty revealed that e-commerce was a "stand-out" growth driver, with increases of over 20% in e-commerce revenue from both divisions.

Geographically, all regions also generated double-digit percentage revenue growth. EMEA sales expanded 16%, boosted by most markets and travel retail.

In addition to sales growth, the company reported a 19% increase in operating income to £187.3 million ($236.7 million). Adjusted EBITDA also grew 15% to £290.1 million ($366.4 million).

Looking ahead, Coty continues to expect revenue growth of 9-11% for FY24. This includes an increase of 6-8% in second half.

Sue Nabi, CEO of Coty, said: "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.

"Our amazing brands and industry-leading capabilities are enabling Coty to bring exceptional innovations to the market, further strengthening consumers' desire for beauty.

"All together, we are continuing to deliver on our balanced growth agenda, with growth in both prestige and consumer beauty, in each of our regions, in each of our categories of fragrances, cosmetics, skincare and bodycare, and across volumes, price and mix.

"Importantly, this growth is accompanied by strong and disciplined financial delivery, as we generate robust profit growth, operating and EBITDA margin expansion, and deleveraging progress.

"In sum, as we celebrate the 120th anniversary of Coty as a beauty pioneer, we are proud of the progress we have made and are energised by the many opportunities in front of us."

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