Beauty products maker Coty Inc (COTY.N) reported a better-than-expected adjusted profit in its first quarterly results as a public company, mainly due to strong sales of branded perfumes such as Marc Jacobs and Chloe in Asia.
The company, however, said it expects current-quarter net revenue to decline marginally as market growth slows in the United States and Europe.
“Over the last few months, the company has seen a deceleration of market growth in the U.S. and Europe, triggering significant trade de-stocking activity, particularly by U.S. mass retailers,” the company said in a statement.
Fragrances account for the bulk of Coty’s business, even though the company has expanded in skin care, nail products and other categories through acquisitions.
Last year, 53 percent of the company’s revenue of $4.61 billion came from branded fragrances such as Adidas, Calvin Klein and Chloe as well as those under the names of celebrities such as Beyonce Knowles, Lady Gaga and Jennifer Lopez.
Coty’s revenue from fragrances and skin and body care products rose 6 percent in the fourth quarter.
Overall revenue rose 3.9 percent to $1.06 billion, helped by a 11 percent growth in sales in Asia.
The company made its market debut on June 13, a couple of weeks before the fourth quarter ended. The company’s net loss narrowed to $62.3 million, or 16 cents per share, in the quarter ended June 30, from $357.3 million, or 95 cents per share, a year earlier.
Coty’s stock closed at $16.25 on the New York Stock Exchange on Monday, down 7 percent from its initial public offering price of $17.50.
Adjusted earnings per share, which exclude items such as expenses related to private company share-based compensation, were 3 cents per share.
Analysts on average were expecting adjusted earnings of 1 cent per share on revenue of $1.05 billion, according to Thomson Reuters I/B/E/S.
REUTERS
About the Author
