Estee Lauder (EL) Tops Q1 EPS by 54c, Revenues Beat

Estee Lauder (NYSE: EL) reported Q1 EPS of $1.44, $0.54 better than the analyst estimate of $0.90. Revenue for the quarter came in at $3.56 billion versus the consensus estimate of $3.45 billion.

• Net Sales Decreased 9% both As Reported and in Constant Currency
• COVID-19 Recovery Progressed with Sequential Net Sales Growth Improvement
• Diluted EPS was $1.42, Adjusted Diluted EPS in Constant Currency was $1.44

Fabrizio Freda, President and Chief Executive Officer said, “We are pleased with the stronger than expected start to our fiscal year amid this difficult moment as the global community continues to confront COVID-19. We delivered significant sequential improvement in net sales growth in every product category driven by progress around the world. Asia/Pacific again excelled with double-digit year-over-year growth in mainland China. Travel retail was a stand-out performer as Chinese tourists were drawn to the growing duty-free shops in Hainan Island and purchase limits increased there.

Innovation flourished, representing over 30% of sales in the quarter, and the online channel1 thrived in every region. We successfully adjusted our cost structure to minimize the deleveraging effects of lower sales, while continuing to invest for growth, enhancing our capabilities online and supporting our innovation.

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1Online sales discussed throughout includes sales of our products from our websites and third-party platforms, as well as estimated sales of our products sold through our retailers’ websites

Looking ahead, our focus, first and foremost, is still the safety and well-being of our employees and consumers. We remain mindful of the ongoing effects of COVID-19 on consumers, the retail sector and economies as well as geopolitical uncertainty. We continue to expect our multiple engines of growth strategy to deliver sequentially improving sales growth each quarter in fiscal 2021, which we expect will build upon our estimated global prestige beauty share gains since the pandemic began. We are confident in the long-term growth opportunities for global prestige beauty and for the Company, reflected in our announcement today to raise our quarterly dividend by 10%.”

Freda concluded, “Today, we will release our fiscal 2020 Citizenship and Sustainability Report, entitled Beauty Inspired, Values Driven. The report highlights the achievement of our 2020 ESG goals as well as meaningful progress towards our 2025 goals. These milestones were reached across our citizenship and sustainability priority focus areas, despite the challenges of the pandemic.”

For earnings history and earnings-related data on Estee Lauder (EL) click here.

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