e.l.f Beauty posts 50% sales rise as shoppers re-embrace makeup

Sales at e.l.f Beauty soared by 50% in three months to June 30 as consumers around the globe flocked back to the makeup category following the easing of Covid-19 restrictions around the world.

The California-based brand, which is sold in the UK via a wide range of retailers including Superdrug, Boots and Lookfantastic, said its products were resonating with consumers and that brand momentum was “strong.”

Net sales increased by 50% to $97m in the three months to June 30 compared to the same time last year – with the rise “primarily driven” by e.l.f's strength within national and international retailers it said.

e.l.f also posted an adjusted EBITDA of $21.7m or 22.4% of net sales, up 40% year on year.

Gross margin decreased to 63.8%, primarily driven by unfavourable foreign exchange rates, elevated transportation costs and an increase in inventory adjustments, it added.

The “exceptional first quarter results” have led e.l.f to raise its fiscal 2022 outlook to reflect an expected 12-14% increase in net sales, up from the 8-10% increase previously expected.

e.l.f Beauty Chief Executive Officer Tarang Amin said: “I’m proud of the e.l.f Beauty team for delivering exceptional first quarter results, highlighted by 50% net sales growth.

“We've seen consumer demand for colour cosmetics inflect positively and we continue to outperform our competitors.

“In the first quarter, e.l.f Cosmetics was the only top 5 US colour cosmetics brand to post growth and gain share relative to pre-pandemic levels, per Nielsen.

“We’re raising our fiscal 2022 outlook given our outstanding first quarter results and our expectations for continued momentum across our brand portfolio,” e.l.f Beauty’s Chief Financial Officer Mandy Fields added.

“Our marketing and digital initiatives are delivering strong return on investment, and we’re leaning into these programs to fuel our growth.”