Elizabeth Arden sales slide on double hit from currency exchange and US market

By Simon Pitman contact

- Last updated on GMT

Elizabeth Arden sales slide on double hit from currency exchange and US market

Related tags: Generally accepted accounting principles

Elizabeth Arden had a tough fourth quarter, with revenues suffering on account of unfavourable currency exchange and a big decline in its North American operations.

The fragrance and color cosmetics player said that net sales were down from $191.7m to $175.5m. On an adjusted basis the net sales were $188.7m, which represented a fall of 6.7%, and up 0.7% at constant currency rates.

The net loss for the quarter was $108.9m, which was an improvement compared to the net loss of $155.9m in the corresponding quarter last year.

Elizabeth Arden brand did better

The company underlined that its Elizabeth Arden branded products had helped to buoy the results, with sales down 2%, but up 7% at constant currency rates.

“This is the second consecutive quarter of sales growth for the Elizabeth Arden brand. The 7% constant currency increase this quarter is on top of a 9% constant currency increase in the third fiscal quarter,”​ said CEO E. Scott Beattie.

“This gives us confidence as we head into the launch of the new Elizabeth Arden brand marketing campaign this fall, which is accompanied by a richer innovation pipeline.”

Regional and full year results

Geographically there was a big difference between the company’s international and North American markets, with sales in the domestic market falling 14%, or 13% at constant currency rates, which was down to a decline in the company’s Elizabeth Arden branded fragrances.

Net sales in the international markets increased 4%, and were up by 15% in constant currency terms, reflecting a big increase in sales for Elizabeth Arden branded fragrances and skin care products, particularly in Asia.

For the full financial year the company said that sales came in at $971.1m. On an adjusted basis the figure was $999.3m, which represented a fall of 14.9% compared to last year’s figure, and a decrease of 13.1% at constant currency rates.

Outlook

Looking ahead to the next financial year, the company said it forecasts that net sales will continue to increase on the back of a stronger performance in international markets and the Elizabeth Arden brand.

Likewise, the company also foresees an improved EBITA margin, mainly from lower indirect overheads.

Related topics: Business & Financial

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