Coty raises annual core sales outlook as fragrances, cosmetics drive demand By Reuters

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<span>© Reuters. FILE PHOTO: Covergirl makeup, owned by Coty Inc, is seen for sale in Manhattan, New York City, U.S., February 7, 2022. REUTERS/Andrew Kelly/File Photo</span><br />
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<p>By Ananya Mariam Rajesh</p>
<p>(Reuters) – Coty (NYSE:) on Tuesday raised its annual core sales forecast on the back of higher pricing and strong demand from customers who snapped up the CoverGirl maker’s new makeup and fragrance launches.</p>
<p>The beauty market’s post-pandemic growth has thrived as customers prioritize spending on “affordable luxuries” at a time when sticky inflation has impacted consumption patterns and pushed many customers to put off big-ticket purchases in the United States and Europe.</p>
<p>Coty also posted sales growth in the Americas and Europe similar to beauty company L’Oreal, that noted an acceleration in growth in these regions after an initial slowdown.</p>
<p>Coty’s efforts to launch key products such as Burberry Goddess in its high-end “prestige” category and CoverGirl’s Yummy Gloss in the consumer beauty category drove a double-digit increase in these segments.</p>
<p>“We are not seeing any depressed category … prestige fragrance in U.S. keeps growing very fast,” CFO Laurent Mercier told Reuters, adding that Gen Z was active and driving growth in the consumer beauty segment.</p>
<p>Coty now expects fiscal 2024 core like-for-like sales growth between 9% and 11%, compared with its previous outlook of an 8% to 10% rise.</p>
<p>The company’s first-quarter net revenue rose 18% to $1.64 billion, beating estimates of $1.58 billion, according to LSEG data.</p>
<p>However, Coty reported a net loss, compared with a profit a year earlier, due to an impact from an equity swap and higher costs.</p>
<p>The company posted a first-quarter net loss attributable to common shareholders of $1.7 million, compared with a profit of $125.3 million a year earlier.</p>
<p>Coty also reaffirmed its full-year adjusted per-share profit forecast between 44 cents and 47 cents. </p>
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