雅诗兰黛(c.US)2026财年第二季度业绩电话会
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会议摘要
Company reports robust Q2 performance with 4% organic sales growth, 290 bps operating margin expansion, and 43% EPS increase. Highlights include strategic channel realignment, innovation acceleration, and market share gains, particularly in China and emerging markets. Outlook for FY2026 sees organic sales growth of 1%-3%, operating margin of 9.8%-10.2%, and a 36%-49% EPS increase, underscoring confidence in disciplined execution and long-term value creation.
会议速览
SJ Lauder Company's Q2 2026 Financial Conference CallThe company's leadership, including the president, CEO, and CFO, are addressing investors during the second quarter fiscal 2026 conference call, focusing on financial updates and company performance.
Strong Q2 Results, Retail Sales Growth, and Beauty Reimagine ProgressThe company reported robust Q2 results, highlighting strong retail sales growth and the successful execution of the Beauty Reimagine initiative. Key achievements include expanding consumer coverage, enhancing innovation, and gaining market share in various regions. The company outperformed prestige beauty in several markets, showcasing its momentum and strategic priorities.
Revolutionizing Beauty: Enhanced Sales Growth, Innovation, and Strategic ReorganizationThe company has achieved strong double-digit retail sales growth, driven by innovation and expanded consumer reach. Key initiatives include launching new products, boosting consumer-facing investments, and reorganizing to streamline operations. The outlook is positive, with increased organic sales growth, margin expansion, and EPS growth anticipated for the upcoming fiscal year. The strategy focuses on sustainable growth through efficiency gains and technological advancements, positioning the company for long-term success in the prestige beauty sector.
Strong Q2 Sales Growth Driven by Strategic Investments and Margin ExpansionThe company achieved 4% organic net sales growth, led by skincare and fragrance, with double-digit gains in China and emerging markets. Gross margin expanded 40 basis points to 76.5%, and operating margin grew 290 basis points to 14.4%, driven by cost efficiencies and disciplined investment. Effective tax rate decreased to 39.8%, and diluted EPS surged 43% to 89 cents, reflecting successful execution of growth strategies.
Progress in Restructuring and Financial PerformanceDiscussed significant restructuring progress, including global service consolidation, and shared improved financial outlook for fiscal 2026, highlighting increased net sales and operating margin expansion.
Analysis of Americas Market Growth: Momentum, Channel Rebalancing, and Guidance for Q4The dialogue discusses the recovery and growth momentum in the Americas market, highlighting gains in market share and brand re-engagement. It addresses channel rebalancing, particularly in North America, and notes challenges in Latin America due to economic factors. Guidance indicates stronger Q4 growth, driven by adjustments in travel retail and expectations to meet the top end of financial guidance.
Travel Retail Business Momentum and Market Share GrowthDiscusses travel retail's strong performance in Hainan, with improved conversion rates and diverse brand portfolio growth. Highlights challenges in mainland China and Korea due to market disruptions, but expresses confidence in market share gains and brand deployment. Emphasizes ELC's outperformance in Western markets, Japan, and Thailand, signaling positive business momentum.
Strategies for Enhancing Makeup Category Profitability and InnovationDiscussed improving makeup profitability through cost optimization, distribution expansion, and innovation acceleration, with emphasis on Mac brand growth and strategic market entries.
Progress in Skin Care and Makeup Category InnovationDiscussion highlights advancements in skincare due to scaling efforts, emphasizing the need for similar growth in the makeup sector through brand deployment and innovation acceleration.
China's Promotional Environment & Year-Round Sales Strategy in Beauty MarketDiscusses China's promotional environment around 1111, emphasizing strong sales during big events and strategies for boosting everyday performance and excitement outside key holiday periods.
Leveraging Experience Over Promotions: A Strategy for Post-Pandemic Consumer EngagementThe dialogue emphasizes a strategic shift towards experiential marketing and gifting, reducing reliance on high promotional events. By focusing on creating meaningful connections with consumers through freestanding stores and exclusive events, the company aims to balance the calendar year, raise consumer-facing prices, and accelerate growth above market trends. Despite subdued consumer sentiment, the approach has proven effective, with notable gains in key categories post-major sales festivals, positioning the brand for stronger performance into the future.
China Market Discounts Decline Amid Sales Growth and Profitability ImprovementThe dialogue highlights the strategic reduction of discounts in China's market, which has led to sales growth, profitability improvement, and a shift towards more experiential retail, benefiting long-term brand development.
Improving Dynamics in North America: Closing the Sell-in and Sell-out GapThe discussion focuses on the narrowing gap between sell-in and sell-out in North America, attributed to strategic shifts towards online platforms and effective inventory management. The speaker anticipates continued improvement, projecting positive growth trends for the remainder of the year, following a challenging first quarter.
Shift Towards Higher Growth Channels in Brand EvolutionDiscussion on the transition of business focus from traditional heritage channels to higher growth channels, emphasizing the expansion into online platforms like Amazon and TikTok, and the development of direct-to-consumer and luxury retail experiences.
Balancing Department Store Presence with High Growth Channel Expansion for Brand SuccessThe importance of maintaining strong department store positions while shifting focus to high growth channels and leveraging the performance of brands like The Ordinary for volume growth is emphasized. Strategic partnerships with major retailers are crucial for capturing consumers and sustaining market share. This approach ensures adaptability to consumer trends and drives overall brand success.
European Market Update: Sequential Improvement and Strategic Focus on UK and Emerging MarketsDiscusses stabilization and improvement in Europe's market, emphasizing the UK's recovery and strong performances in Spain and Italy. Highlights double-digit growth in emerging markets, particularly Turkey, and mid-single digit in India. Mentions strategic initiatives including Amazon platform expansion, distribution rationalization, and innovation launches for continued growth.
Q4 Growth Projections Amid Asia Market Adjustments and Retailer TransitionsThe dialogue discusses expected mid-single-digit growth in China for the second half, influenced by market adjustments, retailer transitions, and travel retail challenges. Q4 growth is anticipated to be stronger than Q3 due to the phasing effect and overcoming initial market disruptions.
Company's Commitment to Achieving Top-End Guidance and Long-Term GrowthThe company reaffirms its mission to achieve the top end of its financial guidance for the fiscal year, highlighting strong momentum in the first half, market share gains, and a focus on long-term growth through strategic partnerships and operational efficiencies. It anticipates delivering a refreshed long-range plan by August, emphasizing market share gains, brand and geographic growth rebalancing, and increased agility in operations.
要点回答
Q：What were the key performance indicators for the SJ Lauder Company's second quarter?
A：The key performance indicators for the SJ Lauder Company's second quarter include strong organic sales growth, expanding profit and operating margin, and growing earnings per share (EPS) by 40%.
Q：How has the company's strategy to 'Reimage Beauty' performed in its first year?
A：The 'Reimage Beauty' strategy has led to significant accomplishments in the first year, such as creating momentum across strategic priorities, achieving 100 year纪念日, and expanding consumer coverage both online and offline.
Q：What were the gains in retail sales and market share for the SJ Lauder Company?
A：Retail sales for the SJ Lauder Company grew 4% in the first half of fiscal 26, outperforming Prestige Beauty and gaining share in various markets and product categories.
Q：How did the company's portfolio presence expand in consumer preferred, high-growth channels?
A：The company's portfolio presence expanded in consumer preferred, high-growth channels by increasing its presence on Amazon's Premium beauty stores, launching brands on TikTok Shop, and entering new markets like the UK and Germany.
Q：How did the company's focus on retail and online channels contribute to sales growth?
A：The company's focus on retail and online channels led to double-digit retail sales growth in the first half and online sales exceeding the script of reported sales, driven by new and upgraded doors in travel retail across the West and strong performance in duty-free and prestige formats.
Q：What updates were provided regarding the company's full-year outlook?
A：The company raised its fiscal 26 outlook with a narrower organic sales growth range towards the high end, increased operating margin expansion, and higher projected EPS growth, reflecting confidence in the turnaround and ongoing performance improvements.
Q：Which segments led the growth in organic net sales?
A：Growth in organic net sales was led by a 6% increase in both the skincare and fragrance segments.
Q：What factors contributed to the growth in gross and operating margins?
A：Gross margin expanded by 40 basis points, supported by benefits from Practicing B, operational efficiencies, and excess and obsolescence reductions through zero waste initiatives. Operating margin expanded by 290 basis points, driven by disciplined investment allocation, reduction in non-consumer facing expenses, and a 7% increase in consumer facing investments.
Q：How did the company's restructuring efforts affect cash flows?
A：For the six months, the company generated $785 million in net cash flows from operating activities, which is a significant improvement compared to the $387 million generated last year.
Q：What are the updated expectations for fiscal 2026, specifically regarding organic net sales and operating margin?
A：For fiscal 2026, the company has narrowed its range for full year sales to expect an increase of 1 to 3% compared to last year. The operating margin is now assumed to be between 9.8 and 10.2%, up from the previous assumption of 9.4% to 9.9%, reflecting both the strong first half performance and greater gross margin expansion than expected.
Q：What are the main factors leading to the anticipated growth in the Americas region?
A：In the Americas region, the company has gained market share in volume and value, particularly in the skin care category. The number one and number two spots in the brand rankings in skin care and makeup are held by the company's brands. They have communicated their entry into prestige multi-channel distribution in the U.S. as a major milestone. The rebalancing of channels and strategic actions, including moving quickly with Amazon and repositioning department stores, are contributing to the overall momentum in the Americas.
Q：How is the company performing in Latin America, and what challenges are present?
A：In Latin America, despite strong initial performance at the beginning of the year, consumer consumption has slowed down. One of the main challenges is that inactive types are starting to hurt consumer confidence in Latin America. However, the company still has momentum in the market, volume share is back, and there is an expectation for additional momentum going forward. The company is optimistic about the future performance in the region.
Q：What is the current state of the travel retail business, particularly in Hainan?
A：The travel retail business is currently seeing strong momentum and acceleration, especially in Hainan. There has been significant traffic growth, and the company has been able to convert this traffic into sales, gaining market share across many brands. January sales in Hainan were in high double digits, and the company is particularly excited about the upcoming Chinese New Year period.
Q：How significant is Hainan in the context of the entire travel retail East?
A：Hainan is only a part of the travel retail East, which also includes the airports in Beijing and Shanghai and the universal app that allows online purchases. The travel retail East encompasses the whole of APAC, but Hainan is emphasized as a critical component of this region.
Q：What changes occurred in the last quarter in the Shanghai-Beijing and Universal app ecosystem?
A：In the last quarter, there was a transition from Sunrise to CDF, 1 Fuji, and Avota, leading to a disruption in the market. The universal app, which was a significant part of the business, was shut down in Q2 and remained closed, affecting the company's ability to convert sales. China mainland outperformed in Q2, while total travel retail fell short of expectations.
Q：How does the company view the impact of the current inventory management approach?
A：The company is managing its inventory very carefully, shipping only to meet demand, and sees the recent changes as beneficial. The company has strong partnerships with CDF, 1 Fuji, and Alta, and is in the process of implementing the right strategies to ensure it can accelerate in the remainder of the fiscal year and beyond.
Q：What progress is being made in the Japanese market and how is the company performing across other markets in the region?
A：Despite disruptive market conditions and geopolitical tensions, the company has been able to gain market share in Japan, even with a dramatic reduction in traffic. The company is also seeing a shift from Japan to Korea and China in the region. In the rest of the APAC region, the company is preparing to welcome consumers with all its brands and is confident in its ability to convert traffic into sales.
Q：What is the outperformance by ELC in the travel retail channel?
A：ELC is outperforming in the travel retail channel, winning significantly in Hainan, and gaining market share in other markets like Japan and Thailand. This outperformance is considered a significant encouragement for the company's business going forward.
Q：What factors are influencing makeup profitability and what are the plans to improve it?
A：Makeup profitability for the quarter was impacted by a return on innovation that will be reflected in the upcoming quarter. This was a temporary effect that understated makeup profitability for the quarter. The company is focused on improving margins across categories and regions, and specifically for makeup, it is right-sizing fixed costs, enhancing PR GP, and accelerating sales. The launch of double-wear and other improvements are expected to further enhance profitability.
Q：What strategic initiatives are being undertaken to improve makeup profitability?
A：Strategic initiatives include reimagining the beauty strategy, expanding distribution through unique partnerships, and entering the Sephora US market with the MAC brand. These moves are expected to improve market share and distribution, particularly in the US and Germany. Innovation is ramping up, and the company is focusing on increasing speed and efficient distribution. The brand is also working on improving its freestanding stores to increase profitability.
Q：What are the expectations for the Chinese New Year period in terms of the promotional environment and brand performance?
A：The company anticipates the Chinese New Year period to be less centered around major selling moments like 1111 and 6, moving towards a more balanced year-round performance. The brand's performance during these periods is crucial for consumer recruitment and retention, as evidenced by their success in becoming the number one prestige buy on Ti-MO and the number one brand in luxury on Ti-MO in China.
Q：What strategies are in place to enhance brand presence and consumer engagement in China beyond major shopping festivals?
A：Strategies include focusing on creating events and VIP experiences for consumers to reduce dependency on high promotional activities, as well as accelerating the number of freestanding stores to bring experiences to consumers and balance the year's sales performance.
Q：How is the company managing inventory levels and retail landscape shifts in North America?
A：The company has made significant progress in reducing inventory levels worldwide, including in North America, to align with the shifting retail landscape. This has led to a clearer difference between retail and net growth, with an expectation for positive growth in North America after the first quarter, moving towards the company's goal.
Q：What is the current shift in the business mix toward higher growth channels, and how is it affecting the company's evolution?
A：The company is reducing its reliance on traditional department stores and increasing penetration in online channels, specialty multi-dealers, and direct-to-consumer businesses. They have 12 brands on Amazon US, and some brands are moving into Sephora. This shift is a key part of their strategy to realign with consumer behavior, maintain market share, and achieve volume growth, especially noting strong performance in high double-digit growth across all channels.
Q：How does the company plan to manage its relationship with department stores while focusing on consumer movement towards higher growth channels?
A：Department stores remain an important strategic channel for the company, and they are working with partners to ensure they capture consumers. The company has a strong leading position in department stores and aims to protect it while also moving towards where the consumer is gravitating, which is increasingly towards higher growth channels.
Q：What strategic steps are being taken in the UK market to improve brand presence?
A：The company is moving some of its brands onto the Amazon platform in the UK, rationalizing distribution, and accelerating work with specialty multi-channel retailers. They have also had great support and performance from Sainsbury's UK.
Q：How is the new organization in the emerging markets contributing to the company's growth?
A：The new organization in the emerging markets has delivered double-digit growth, which is a sequential improvement, driven by various countries including Turkey, Yugoslavia, and even mid-single-digit growth in India.
Q：What is the expected top line trajectory for the back half of the year and the fourth quarter?
A：The company had a strong first half with plus 3% growth. For the back half, especially in China and travel retail, growth is expected to be lower due to a larger base period and the anniversary of past stimulus efforts. The company aims to outperform the market, which is expected to take a step back from double-digit growth. Additionally, a transition of retailers and ordering changes are factors that will impact the back half of the year.
Q：What are the main factors that could impact the company's performance in the back half of the year?
A：The main factors impacting the company's performance include the expected mid-single-digit growth in China which may not achieve double-digit growth, a slightly challenging quarter-to-quarter phasing effect, and the transition of retailers causing temporary ordering disruptions.
Q：What is the company's goal regarding market leadership and how is it being demonstrated?
A：The company's goal is to lead the markets in a very clear way, as demonstrated in China and Japan, and in parts of emerging markets. This is a part of their mission to outperform and gain market share.
Q：How is the company approaching market volatility and what is their strategy moving forward?
A：The company is going for the top end of the new guidance range provided for both top line and bottom line growth for the fiscal year. They are rebalancing growth geographically and between brands, and implementing a one operating ecosystem for agility. They are also refreshing their long-range plan and intend to provide more visibility of mid to long-term growth when they report at the end of the fiscal year in August.
Q：What is the company's objective beyond the transition year and what is the reason behind the transformation?
A：The objective past the transition year is to gain market share. The transformation is why they are diversifying their growth, simplifying ways of working, and bringing in new partners to act with speed and agility. The goal is to reimagine beauty and create efficiency, which will continue to flow through this year and into next year.
