Coty Q4 2022 Earnings Report
Key Takeaways
Coty Inc. reported strong Q4 and FY22 results, with sales growth exceeding expectations. The company's sales increased by 10% as reported and 16% on a LFL basis in Q4. Coty's sales were driven by strong momentum in both divisions, with Prestige growing 16% and Consumer Beauty growing 3% as reported.
Q4 sales increased 10% as reported and 16% LFL, ahead of guidance.
Prestige sales grew 16% as reported and 23% LFL, driven by fragrance and cosmetics.
Consumer Beauty sales rose 3% as reported and 7% LFL, with market share gains.
Adjusted EBITDA was $132.4 million, and free cash flow was $552.5 million.
Coty
Coty
Coty Revenue by Segment
Coty Revenue by Geographic Location
Forward Guidance
Coty expects FY23 revenue and EBITDA to grow in line with medium-term targets, with 6-8% LFL revenue growth. Adjusted EBITDA is targeted at $955-965M, and adjusted EPS growth is expected in the mid-teens.
Positive Outlook
- Prestige fragrance market momentum globally.
- Strong demand growth in Europe, global Travel Retail, Middle East & Africa, and Brazil.
- Strong launch pipeline in both Prestige and Consumer Beauty.
- FY23 adjusted EBITDA of $955-965M based on current FX rates.
- FY23 adjusted EPS growth in the mid-teens.
Challenges Ahead
- FX headwinds on revenues in FY23 to be 4-5%.
- Impact from exiting the Russia business, estimated at 2-3% of revenues in 1H23.
- Estimated FX headwind on sales of 4-6% in 1H23 at current rates.
- Monitoring the ever-evolving macro backdrop.
- Resilience plans developed to support the business should conditions worsen.
Revenue & Expenses
Visualization of income flow from segment revenue to net income