Q4 2024 Estee Lauder Companies Inc Earnings Call Transcript
Key Points
- The Estee Lauder Companies Inc (EL) returned to top-line growth in the second half of fiscal year 2024, with organic sales growth accelerating from 6% in the third quarter to 8% in the fourth quarter.
- The company delivered an adjusted operating margin of 11.6% in the fourth quarter, higher than the first half and expanded from the second half of fiscal year 2023.
- The Ordinary brand saw over 20% organic sales growth in fiscal year 2024 and is expanding into new product categories and emerging markets.
- The Estee Lauder Companies Inc (EL) is focusing on high-growth channels like Amazon and specialty multi-retailers, which showed promising results.
- The company is implementing a Profit Recovery and Growth Plan (PRGP) to restore sustainable long-term organic sales growth and rebuild operating profitability.
- Organic sales for fiscal year 2024 declined by 2%, and adjusted operating margin contracted by 120 basis points to 10.2%.
- The prestige beauty industry in China and Asia travel retail experienced further softening, impacting overall performance.
- The fiscal year 2025 outlook reflects continued declines in the prestige beauty industry in China and Asia travel retail, with a lower pace of operating margin expansion than previously expected.
- The company recorded $471 million of impairment charges related to Dr.Jart due to lower-than-expected growth and profitability.
- The Estee Lauder Companies Inc (EL) expects fiscal year 2025 organic sales growth to range from a decline of 1% to an increase of 2%, reflecting ongoing challenges in key markets.
Good day, everyone, and welcome to the Estée Lauder Company's fiscal 2024 fourth quarter and full Year conference. Today's call is being recorded and webcast for opening remarks and introductions I turn the floor over to Senior Vice President of Investor Relations, Ms. Rainey Mancini. Ma'am, you may begin.
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Hello. On today's call are Fabrizio Freda, President and Chief Executive Officer; and Tracey Travis, Executive Vice President and Chief Financial Officer. Since many of our remarks today contain forward-looking statements, let me refer you to our press release and our reports filed with the SEC, where you'll find factors that could cause actual results to differ materially from these forward-looking statements.
To facilitate the discussion of our underlying business, the commentary on our financial results and expectations is before restructuring and other charges and adjustments disclosed in our press release. Unless otherwise stated, all organic
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