Puig Experiences 26% Drop in Revenue on IPO Prices

Luxurious magnificence and style firm Puig reported a steep drop in its first reported earnings as a listed firm on Friday, citing prices associated to its preliminary public providing (IPO) earlier this yr, sending its shares down as a lot as 13 p.c.

The Barcelona-based firm behind fragrance manufacturers Rabanne, Carolina Herrera and Jean Paul Gaultier stated internet revenue fell 26 p.c to €153.8 million ($171 million), whereas gross sales grew 10 p.c within the first half of the yr. Its working margin fell to 14.4 p.c from 15.3 p.c.

The corporate, which listed on the Madrid inventory trade in Might, primarily blamed the prices associated to its preliminary public providing and worker bonuses for the disappointing earnings.

Chairman and CEO Marc Puig stated in an interview he remained assured that the corporate, which owns plenty of status fragrance, skincare and make-up manufacturers, can develop sooner than the 6 percent-7 p.c forecast for international premium magnificence market.

“This has been our first examination,” Puig stated. “We now have been in step with our steering and we are going to preserve it for the remainder of the yr.”

Puig, which additionally owns make-up and skincare manufacturers reminiscent of Charlotte Tilbury, reported a ten.7 p.c rise in fragrances and style gross sales and 11.6 p.c greater revenues in skincare, however its make-up enterprise offered 1.8 p.c much less within the interval.

The corporate’s CEO stated make-up manufacturers reminiscent of Christian Louboutin had suffered from their publicity to a sluggish Asian market.

He stated he anticipated to proceed to see sturdy momentum throughout EMEA and was optimistic about gross sales within the U.S. for the remainder of the yr. Asia-Pacific, which contributes 9 p.c of its gross sales, will stay tender, he stated. EMEA generated 53 p.c of its whole gross sales and the remaining 38 p.c got here from the Americas.

The post-pandemic growth in fragrances continues, with Jean Paul Gaultier perfumes having fun with reputation on TikTok amongst younger, male shoppers, Puig added.

Puig dominated out additional acquisitions within the short-term, however stated that M&A will proceed to be a development driver, particularly in companies reminiscent of skincare.

“Puig’s outcomes have been under our expectations,” Joaquin Robles, a senior analyst at XTB, stated in an electronic mail. “Its gross sales have been about 2 p.c decrease than we estimated.”

The corporate stated it expects internet income and working revenue for the second half of the yr to be greater because of an anticipated enhance in demand forward of the vacation season.

JPMorgan analysts stated that whereas its first-half outcomes have been weaker than anticipated, its enterprise remained stable.

“The outcomes have been clearly dragged down by weak sell-in in make up, however the underlying well being of the enterprise stays sturdy in fragrances,” JPMorgan stated.

By Corina Pons

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