Coty Raises Full-Year Revenue Forecast, Cancels Partial Wella Stake Sale, Q1 Revenue Grows 18% to $1.64B, Beats Estimates

Coty's Q1 sales growth led by strong demand in beauty market, with Prestige and Consumer beauty segments seeing double-digit LFL increase; sale of partial Wella stake cancelled over final deal term disagreements.

• Coty's Q1 FY24 sales grew 18% YOY to $1.64 billion, surpassing projections of $1.58 billion, owing largely to a 22% LFL increase in Prestige and a 10% LFL increase in Consumer Beauty.
• Despite growing revenue, Coty experienced a gross margin contraction of 40 basis points YOY to 63.5%, and reported a Q1 net loss of $1.7 million, compared to a net income of $125.3 million in the previous fiscal year.
• Coty has upgraded its FY24 LFL revenue growth forecast to between 9 and 11%, over the recently increased guidance of 8 to 10%, and maintains a targeted FY24 adjusted EPS of $0.44-0.47.
• Coty's first-quarter revenue growth was propelled by double-digit growth in all regions, with a 23% rise in Prestige revenues and a 10% increase in Consumer Beauty revenues, marked by strong sales of Burberry Goddess, Gucci Flora, and Burberry Her.
• Despite previous plans, Coty and its counterparties have concluded the proposed partial sale of its Wella stake due to disagreements over the final deal terms; however, Coty maintains its aim to divest its residual 25.9% share of Wella by 2025.

3 Articles

Benzinga Reuters WWD