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This story was updated Oct. 29 at 5:03 p.m.
PARIS — Puig’s 11.6 percent like-for-like sales growth in the third quarter beat market expectations.
The company swiftly outpaced financial analysts’ consensus of 8.8 percent.
“We view this as a strong sales result and reassuring outcome versus first-half results amid some increasing nervousness around fragrance market growth,” wrote Molly Wylenzek, an equity analyst at Jefferies, in a note.
The Spanish beauty and fashion company released earnings after the market closed on Tuesday. Sales at the owner of Rabanne, Carolina Herrera, Byredo and Charlotte Tilbury in the three months ended Sept. 30 amounted to 1.26 billion euros, up 11.1 percent on a reported basis. Business was bolstered by the group’s fragrance and fashion activity, and the EMEA market.
“We are pleased to report an acceleration in the third quarter versus first half,” said Marc Puig, chairman and chief executive officer of Puig, during a call with analysts and journalists Tuesday evening. “This resulted in a robust performance in the first nine months of 2024.”
Puig’s sales in that period came to 3.43 billion euros. On a reported basis, they rose 10.1 percent and by 9.6 percent in like-for-like terms. All of the group’s business segments and geographies contributed to the gains.
“[It’s] well in line with our medium-term guidance provided at the IPO, and well ahead of the premium beauty market,” the executive said. “In addition to the strong performance that we have seen this quarter, we are further encouraged by the performance of Puig in recent weeks.”
courtesy
Regarding the first nine months’ sales, Puig said the key driver was a very strong performance from the group’s core business — fragrance and fashion — in both EMEA and the Americas.
“With double-digit growth in this segment, we continue to reinforce our competitive position and capture incremental value market share,” Puig said. “This was further complemented by a much-improved performance in makeup this quarter, as the gap between sell-in and sell-out, which we spoke about in the first half, continues to narrow.”
Puig noted the company saw incremental organic growth from its skin care segment, in addition to the contribution from Dr. Barbara Sturm, a brand that the company acquired a majority stake in during January.
“We are a leader in the thriving fragrance market, which benefits from very strong underlying trends and robust customer demand,” Puig said.
In the first nine months, the company’s fragrance and fashion activity, its largest, generated 2.53 billion euros in sales, a 10.9 percent rise in both reported and constant terms. The branch contributed 73 percent to Puig’s net revenues in the period.
“We now have three brands in the top 10 prestige fragrance ranking worldwide,” said Puig, who added the company also saw increasing momentum in the niche category, which delivered double-digit growth in the third quarter.
In the first nine months, Puig’s makeup sales were up 1.4 percent in both reported and constant terms to 535 million euros. Strong growth was noted in EMEA and improved performance in the Americas, while the Asia-Pacific region continued to show softness.
“Third quarter 2024 marked the return of the makeup segment into positive growth territory,” Puig said. “The sell-out for the largest brand within makeup, Charlotte Tilbury, remains strong with double-digit growth in its largest markets, EMEA and the Americas.
“For the fourth quarter, the growth in the segment will face a tougher comparison, due to the pipeline sell-in related to the entry of Charlotte Tilbury into Ulta at the end of 2023,” Puig explained.
In the nine-month period, the company’s skin care sales increased 22.9 percent on a reported basis and 9.4 percent organically to 381.5 million euros.
Good Girl from Carolina Herrera New York.
Courtesy of Puig
“The integration of Dr. Barbara Sturm is on track, and the brand continues to perform in line with expectations, having contributed 1.4 percent for nine months [in] 2024,” Puig said.
EMEA remained Puig’s largest and fastest-growing region, with its sales picking up in the third quarter. The region registerd nine-month sales of 1.83 billion euros, which advanced 12.7 percent in reported terms and 11.3 percent on a like-for-like basis.
“The Americas also delivered a standout performance in the third quarter, with robust growth of 8.3 percent at constant perimeters, fueled by the continued strong momentum in fragrance and the performance of makeup,” Puig said.
During the first nine months, sales in the Americas reached 1.29 billion euros, up 9 percent in reported terms and 7.5 percent on an organic basis.
“Without the negative impact of LATAM currencies, our constant perimeter growth for the Americas would have been well into the double digits,” said Puig, who added the company is underexposed in the Asia-Pacific region.
There, sales increased by 1 percent in the third quarter amid continued market challenges. In the nine-month period, sales in the zone were 307.9 million euros, gaining 0.8 percent in reported and constant terms.
“The company continues to invest at a measured pace in the region for the long term, including China, where we have a limited presence, and in India, Japan and South Korea, where we have recently established subsidiaries,” Puig said.
Looking ahead, he is bullish.
“We remain very confident in our ability to deliver for fiscal-year 2024 [results] in line with our mid-term guidance,” Puig said. “We manage a diversified and curated portfolio of brands, and continue to feel encouraged by our consolidated performance across our complementary brands and segments, which balance different and evolving market dynamics.”
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