Coty Aims to Double Skincare Sales in Three Years
Beauty company raises current guidance for sales and margin despite rising costs
The beauty company said that it is on track to see skin care revenue increasing to as much as $600 million by 2025. In China, where it has rolled out brands and targeted new markets, it is already winning over consumers to its skin care lines, Chief Executive Officer Sue Nabi said ahead of a company investor event. She added that the total skin care market is $150 billion, leaving more opportunity for Coty to grow.
Coty’s long-term view comes amid improved sales in its current quarter. The New York-based company, which owns brands such as Lancaster, Orveda and Kylie Skin, said it was raising its sales and margin outlook for its fiscal first quarter due to recent performance in Europe and North America and in the travel retail segment.
It now projects sales to grow by 8% to 9% for the current quarter, up from a prior estimate of 6% to 8%.
Coty also said that the higher sales growth will lead to stronger gross margins, despite continued inflationary pressures.
Shares of Coty, which is expected to report quarterly results in November, rose 3.2% to $8.04 on Wednesday in New York.
The company’s skin care brand Lancaster delivered double-digit growth in recent quarters and the group’s consumer beauty revenue—which comprises color cosmetics, mass fragrances, body products, and skin care—rose 3% to $505.5 million in the fourth quarter. Coty’s consumer-beauty revenue represents 43% of the company’s total sales, according to its financial statements.