Estée Lauder logs $7.7B in EMEA net sales as brick-and-mortar rebounds from pandemic jolt

he Estée Lauder Companies (ELC) generated $7.7 billion in Europe, the Middle East, and Africa (EMEA) net sales for its fiscal year ended June 30, 2022, an 11% increase compared to the prior-year period. Overall net sales increased to $17.7 billion from $16.2 billion in the same period last year, the maker of Tom Ford Beauty and Clinique said.

EMEA results

ELC’s net sales in the EMEA region grew in almost every market, led by the UK, the cosmetic giant disclosed on August 18, reflecting a strong double-digit recovery in brick-and-mortar versus the previous year when the COVID-19 pandemic affected retail traffic. Net sales from most of EMEA’s emerging markets also witnessed double-digit growth, thanks to brick-and-mortar recovery.

The return of social activities and in-store services also partly drove double-digit growth in net sales in makeup, haircare, and fragrance.

“The Americas and EMEA prospered, fragrance soared, and makeup realized the promise of its emerging renaissance,” said President and CEO Fabrizio Freda said in a statement.

EMEA and the Americas also contributed to the growth of travel retail net sales due to increased traffic as COVID-19 restrictions were lifted.

ELC’s organic net sales climbed 8% in the year ended June 30, boosted by double-digit growth in EMEA (10%) and the Americas (16%), thanks to brick-and-mortar retail stores’ recovery as well as travel retail growth and double-digit online growth.

The fragrance and skincare company’s operating income, which was impacted by the stronger US dollar, increased 21% to $3.2 billion in the fourth quarter. As for the EMEA region, the operating income increased due to recovery in brick-and-mortar, “partially offset by an increase in the intercompany royalty expense related to the growth in our travel retail business.”

The non-comparable impacts of net sales related to divestitures, acquisitions, and brand closures in the quarter contributed around 2% to growth in net sales compared to last year.

ELC reported $3.6 billion in net sales for the fourth quarter, a 10% decline from the same period in 2021. Net sales in the three months ended June 30, 2022 decreased in EMEA and Asia/Pacific due to the suspension of commercial activities in Russia and Ukraine following the former’s invasion of its neighbor, ELC said.

Big number

43%. That’s how much EMEA contributed to the total net sales, according to ELC’s website.

Lauder family

Estée Lauder, a Queens native, founded the cosmetics giant with her husband in 1946. ELC is home to over 25 brands such as AVEDA, Clinique, Jo Malone London, MAC, Tom Ford Beauty, and Too Faced.

The Lauder family’s six billionaire members hold stakes in ELC. The family was worth $40 billion as of December 16, 2020, ranking fifth on Forbes’ America’s Richest Families 2020 list. Leonard Lauder, the elder son of the eponymous makeup maven, has a real-time net worth of $22.9 bilion as of August 27, 2022, Forbes estimates, while his son William Lauder is worth $3.7 bilion. His youngest brother Ronald Lauder has a $5 bilion fortune.

Forbes estimates Ronald’s eldest daughter Aerin Lauder and his youngest daughter Jane Lauder have real-time net worths of $3.4 bilion and $5.5 bilion, respectively, as of August 27, 2022.

Other beauty company earnings

ELC released its earnings report after Japanese beauty giant Shiseido’s first half net sales from EMEA increased 8.4% to $417.7 million and L’Oréal logged solid sales in the six-month period ended June 30.