Puig’s Q3 sales rise 11%, beating estimates

Spanish fashion and perfumes company Puig reported an 11% rise in third-quarter sales on Tuesday, beating analysts’ expectations after sector rivals posted disappointing results due to lower demand in China.

The Barcelona-based firm behind perfume brands Rabanne, Carolina Herrera and Jean Paul Gaultier said net sales for the three-months ending Sept. 30 were 1.26 billion euros ($1.35 billion), above the average of 1.17 billion euros forecast by analysts polled by LSEG.

Puig, which made its debut on the Spanish stock exchange in May, is less exposed to the Chinese market than most of its peers. More than half of its net sales came from Europe, the Middle East and Africa, where they grew by 14% last quarter.
In Asia, sales were up 1% to 103 million euros, while they rose 10% in the Americas region.

Chief Executive Marc Puig said retailers are quite bullish on the fragrance category to build up inventory for the holiday season, adding the company is not yet seeing any slowdown in markets such as the U.S. or Europe.

“We see optimism for Christmas,” he told analysts during a call after results came out.

Rival L’Oreal last week reported a 3.4% rise in third-quarter sales, a result that fell short of expectations. The company blamed lower demand for beauty products in China and slower growth in its dermatology division.

Meanwhile, French luxury giant LVMH saw a 3% fall in sales, undershooting estimates as demand in China and Japan weakened.

Puig, which also owns luxury skincare and makeup brands Byredo and Charlotte Tilbury, told investors in September it expects sales this year to grow at a faster pace than the 6%-7% forecast for the global premium beauty market.

The company’s net sales grew 10% to 3.42 billion euros in the first nine months of the year.

Sales in its fragrance business, which generates most of Puig’s revenue, grew by 11%, while skincare sales increased by 19%.
The company’s makeup brands sold 7.3% more, despite cosmetic product sales remaining weak in Asia.