Solid growth in Asia Pacific, including in Australia, has helped cosmetics giant Estee Lauder deliver an 18 per cent increase in third quarter sales, ahead of Wall Street estimates.
Delivering its financials for the quarter ended 31 March in the US on Wednesday, Estee Lauder said “solid sales increases” in Australia, Japan and Thailand, alongside double-digit sales growth in China, drove a 30 per cent increase in net sales from Asia Pacific to US$773 million.
Asia Pacific operating income was up 57 per cent to US$179 million, offsetting a 62 per cent fall in American earnings to deliver the company a total 16 per cent increase in operating income to US$497 million for the period.
Declining retail traffic weighed on Estee Lauder’s US-based bricks-and-mortar stores, but momentum in Asia Pacific has buoyed the business, which expects full year revenue to increase by 15 – 16 per cent, slightly higher than market consensus forecasts.
President and chief executive Fabrizio Freda said it was an “excellent” quarter for the business in what he expects will be an “outstanding fiscal year”.
“Among our multiple engines of growth, travel retail, online and Asia again were standouts, and we experienced strong momentum in other high growth channels and markets,” he said.
“Our performance this quarter reflected robust global demand across our portfolio, with virtually all our brands posting sales growth.”
Asian skincare sales and fragrance were standouts for the business, offsetting operating losses in make-up and relatively flat growth in haircare products during the quarter.
The company’s MAC makeup brand performed particularly well in Asia Pacific during the quarter, while La Mer and Estee Lauder drove growth in skincare.