Coty reports first profit miss in seven quarters
today May 3, 2016
Perfume maker Coty Inc reported its first profit miss in seven quarters, hurt by higher costs and weak demand for products such as Sally Hansen nail polishes in the United States.
Coty, which sells Katy Perry and Beyonce's perfumes, has been spending billions on expanding its beauty and skin care businesses to reduce its reliance on fragrances.
Fragrance sales, still Coty's biggest business by revenue, fell 4 percent, marking the seventh straight quarterly decline, while sales of color cosmetics rose 11 percent.
Sales in the Americas fell 7.3 percent to $366 million in the three months ended March 31.
The company is on track to buy over 40 brands from Procter & Gamble Co for over $12 billion.
Net revenue rose 1.8 percent to $950.7 million, the first rise in six quarters.
Coty reported a net loss of $26.8 million, or 8 cents per share, compared with a net income of $75.5 million, or 21 cents per share, a year earlier.
Excluding items, the company earned 9 cents per share.
The company recorded $37 million in costs related to its acquisitions. Selling, general and administrative expenses rose 11 percent.
Analysts on average had expected earnings of 12 cents per share and revenue of $970.7 million, according to Thomson Reuters I/B/E/S.
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