Coty reported second quarter net revenues of 1,727.6 million dollars increased 13 percent, while like-for-like (LFL) revenue increased 11 percent, driven by a 15 percent LFL increase in Prestige and a 5 percent LFL increase in Consumer Beauty.
Year-to-date reported net revenues of 3,369 million dollars, increased 16 percent and LFL revenue grew 14 percent driven by an 18 percent LFL increase in Prestige and a 7 percent LFL increase in Consumer Beauty.
Commenting on the operating results, Sue Nabi, Coty's CEO, said in a statement: "The strength of our Q2 and first half results reinforce several of our convictions, including the attractiveness of the beauty market, the continuing momentum of the fragrance index, the power of our brands, Coty's transformed and industry-leading capabilities, our new ability to create blockbuster fragrance launches, and our disciplined financial execution.”
Highlights of Coty’s Q2 and H1 results
The company’s reported gross margin of 65.1 percent in the second quarter decreased 40 basis points year-over-year, while adjusted gross margin of 65.1 percent decreased by 40 basis points. Year-to-date reported gross margin of 64.3 percent decreased 50 basis points, while adjusted gross margin of 64.3 percent decreased from 64.8 percent in the prior year.
Second quarter reported net income of 177.6 million dollars decreased from net income of 235 million dollars in the prior year, while adjusted net income of 229.1 million dollars increased from 191.9 million dollars in the prior year.
Year-to-date reported net income of 175.9 million dollars decreased from 360.3 million dollars in the prior year and adjusted net income of 303.2 million dollars increased from 284.6 million dollars in the prior year.
Reported EPS for the quarter of 20 cents decreased from 27 cents in the prior year, while adjusted EPS of 25 cents increased from 22 cents in the prior year.
Year-to-date reported EPS of 20 cents decreased from 42 cents in the prior year and adjusted EPS totaled 34 cents, an increase from 33 cents in the prior year.
Coty forecasts strong LFL growth in FY24
Coty continues to expect FY24 LFL revenue growth between 9 to 11 percent, which includes expectations for 6 to 8 percent LFL revenue growth in second half FY24, consistent with its medium term growth algorithm.
The company continues to target FY24 adjusted EBITDA margin expansion of 10 to 30 basis points and FY24 adjusted EBITDA of 1,080 to 1,090 million dollars based on current FX rates with a modest gross margin expansion year-over-year. Coty continues to target FY24 adjusted EPS of 44 cents to 47 cents, implying a strong 16 to 25 percent year-over-year growth.