US-based beauty company Coty has reported strong results for the first quarter (Q1) of the fiscal year 2022 (FY22), which ended on 30 September.
Driven by robust physical retail growth and a 23% growth in e-commerce, the company’s revenues grew by 22%, or 20.6% on a like-for-like (LFL) basis, in the quarter.
The company’s Prestige business posted a 35% revenue growth and a 34% LFL growth, despite the continued reduction in sales in low-quality channels.
Sales in Coty’s Prestige fragrance business increased for almost all its brands, driven by major sellers such as Gucci, Burberry, Hugo Boss, Marc Jacobs, Calvin Klein and Chloe.
Coty delivered a reported operating income of $17.2m and its adjusted operating income increased by $85.7m to $200.5m, as well as earnings per share (EPS) of $0.13 and adjusted EPS of $0.08.
Coty CEO Sue Nabi said: “Our objective coming into FY22 was to build on the great results we delivered last year and further execute on our strategic growth pillars.
“I am very pleased to say that we are off to a great start, building upon our success.
“Q1 marks the fifth consecutive quarter of Coty delivering results in line with or ahead of expectations.
“Importantly, our Q1 results exemplify the virtuous cycle that we have been working to create, where our strong topline performance coupled with sustained gross margin expansion and cost initiatives, fuel both profit expansion and targeted re-investments to support future growth.”
In response to its Q1 results, Coty has increased its FY22 LFL sales outlook to a percentage improvement in the low to mid-teens.
The company also expects adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) of $900m on a constant currency basis.
Last month, Coty agreed to sell a share of around 9% in professional and retail hair business Wella to its majority owner, KKR.