Elizabeth Arden results defy downward market trend
The company said that net sales increased by 6 percent to $429.92m, compared to $405.63m in the corresponding period last year, a figure that represented a rise of 5.8 percent when factoring in the slight negative impact of currency translations.
However, where the company truly shone was its net income, which grew by 24.8 percent to $42.37m, compared to $33.95m in the corresponding quarter last year.
The company has implemented a successful restructuring program which has helped protect it against the increasing problem of rising costs, something that has hit some of the biggest names in the cosmetics and personal care business hard in recent quarters.
Likewise, its continued emphasis on emerging markets, combined with a focus to promote its leading color cosmetic brands has also helped to boost sales significantly, in turn contributing to the big rise in profits.
Net sales for the company’s international business, which includes the emerging markets, increased by 9.4 percent to $142.83m, which represented a rise of 8.4 percent when factoring in unfavorable currency exchange rates against the US dollar.
Net sales in the mainstay North America market increased by 4.4 percent to $287.10m, a figure that reflected a big rise in revenues from the company’s prestige business, which grew by 20 percent.
For the first six months net sales increased by 6.2 percent to $733.5m, while net income grew 33 percent to $51.60m.
“Global sales of Elizabeth Arden branded products grew by 12% fiscal year-to-date with sales of the skin care and color cosmetic portfolio increasing by 20 percent and 16 percent, respectively,” said CEO Scott Beattie.
“We are well underway with our global repositioning of the Elizabeth Arden brand that will impact almost every aspect of the brand and its products,” added Beattie, who also pointed to the continued acceleration of the new Elizabeth Arden brand.
The company confirmed it is sticking to full year 2012 sales growth of 5 – 6 percent, which takes into account and anticipated unfavorable impact of currency translations, but is raising its guidance for full gross margin from 200 to 250 basis points.