Global beauty brand Coty Inc. (NYSE: COTY) came out with first quarter earnings that exceeded Wall Street’s expectations on Wednesday, sending its share price up more than 13%.
The parent of cosmetics companies like Rimmel and CoverGirl said it earned an adjusted USD 0.07 per share during the three months ended September, outpacing estimates of USD 0.06 per share. A year ago, Coty delivered adjusted earnings of USD 0.11 per share.
Total revenue declined 4% year-over-year to USD 1.94 Billion, missing Wall Street’s call for USD 1.97 Billion. This compares to year-ago revenue of USD 2.03 Billion.
Coty recorded sales growth across both its Luxury and Professional Beauty business segments. The company’s Consumer Beauty division faltered, however, shrinking 13.5% to USD 716.5 Million due to disappointing sales from its Younique brand. Coty in late August decided to terminate its partnership with the multi-level marketing business.
The Luxury division generated revenues of USD 806.7 Million, an increase of 1.7% year-over-year thanks to steady growth in the luxury fragrance market.
Coty’s Professional Beauty business, which includes American nail polish manufacturer OPI, delivered revenues of USD 419.6 Million, up 2.4% year-over-year.
By region, Coty posted sales declines in each of its three major markets. North America revenue shrank 9% to USD 586.6 Million. Sales across Europe and the rest of the world fell 0.3% and 5.4%, respectively.
For fiscal 2020, Coty is forecasting net revenues to remain unchanged year-over-year. Adjusted EPS is expected to grow mid-single digits, the company said.
Coty on Wednesday also announced a quarterly dividend of USD 0.125 per share, payable on December 27.
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