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Mar 31, 2023
Olaplex Q1 2023 Earnings Report
Olaplex's first quarter results were in line with expectations, and the company made progress on priority actions for the reset year.
Key Takeaways
Olaplex reported net sales of $113.8 million, a decrease of 38.9% compared to the first quarter of 2022. The company's performance was impacted by lower demand for core products, inventory rebalancing at professional and specialty retail customers, and the absence of inventory pipeline sales to a key specialty retailer.
Net sales were $113.8 million, down 38.9% compared to Q1 2022.
Professional net sales were $48.4 million, a decrease of 37.2%.
Specialty Retail net sales were $34.9 million, a decrease of 45.8%.
Direct-To-Consumer net sales were $30.5 million, a decrease of 31.9%.
Revenue by Segment
Revenue by Geographic Location
Forward Guidance
The Company expects 2023 to be a reset year in which it increases investments to support future growth, and has not changed guidance for net sales, adjusted net income and adjusted EBITDA for fiscal year 2023, as initially disclosed by the Company on February 28, 2023.
Positive Outlook
- Second Quarter 2023 Net Sales: The Company expects net sales in the second quarter of 2023 to modestly improve on a sequential basis from the first quarter of 2023
- Second Half 2023 Net Sales: In the second half of 2023, the Company expects net sales to benefit compared to the first half of 2023 from the impact of new product introductions, additional distribution gains, and improvements in customer demand due to the Company's increased investments in sales, marketing and education.
- Gross Profit Margin: The Company anticipates an approximate 300 to 400 basis point decline in gross profit margin in 2023 compared to 2022 as a result of expected increases in warehousing and distribution costs and anticipated deleveraging from lower sales volume, which is expected to more than offset the positive impacts of cost savings and price increases implemented in the second half of 2022.
- Adjusted EBITDA phasing: The Company expects Adjusted EBITDA margin in the range of approximately 46.4% to 50.8% for fiscal year 2023, assuming the fiscal 2023 net sales and Adjusted EBITDA ranges reflected in the fiscal 2023 guidance above.
- Interest Expense: The Company expects net interest expense to be approximately $40 million during fiscal year 2023, which includes net impacts from short-term investments of the Company's cash and cash equivalents balance.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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