Estee Lauder Beats Expectations, But Gives Downbeat Profit Outlook

By Tomi KilgoreMarketWatch Pulse

Estee Lauder Companies Inc. reported Friday fiscal second-quarter earnings that rose to $446.2 million, or $1.19 a share, from $435.7 million, or $1.13 a share, in the same period a year ago. Excluding non-recurring items, adjusted earnings per share came to $1.22, beating the FactSet consensus of $1.11. Sales increased 3% to $3.12 billion, above the FactSet consensus of $3.08 billion, as better-than-expected makeup, fragrance and hair care sales offset a slight miss in skin care. The beauty products company said it expects fiscal third-quarter adj. EPS of 55 cents to 58 cents and sales growth of 2% to 3%, compared with a FactSet consensus EPS estimate of 76 cents and sales estimate of $2.65 billion, which implies 2.5% growth. For the full fiscal year, adjusted EPS is expected to be $3.07 to $3.12, below the FactSet consensus of $3.18. ""While economic and geopolitical volatility creates challenges, the balance and diversity of our brand portfolio, distribution channels and markets mitigate reliance on any one part of our business," Chief Executive Fabrizio Freda said. The stock, which was still inactive in premarket trade, has gained 0.3% over the past three months while the S&P 500 has lost 8.8%.

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