At the Estée Lauder Cos. Inc. annual shareholders meeting on Thursday the mood was as buoyant as the strong business results.
The company sales in fiscal 2012 gained 10.3 percent to $9.71 billion, growing twice the rate of global prestige beauty. The company also touted several other highlights during the year: Lauder’s net sales in Asia Pacific topped $2 billion, its travel retail business surpassed $1 billion and China emerged as the company’s largest market in Asia and Lauder’s third biggest market globally.
“Our business model works,” Fabrizio Freda, president and chief executive officer, told shareholders. The worry, he acknowledged is challenges in the global economy, particularly in Western Europe where both the economy and market are weak. The market in China is also softening. “China’s economy overall has been slowing down,” said Freda, but he added it is still strong and there’s ample room to grow. Freda said Lauder has brands in 64 of China’s major cities and is expanding into an additional 100 cities, which he views as untapped opportunity for pent-up growth. The company plans to open 200 points of sale in China this year.
Freda told shareholders the company continually tracks the global shopping patterns of customers who live in emerging markets. Lauder has found that for every $1 Chinese shoppers spend in China, they spend $2 in other places, and the trend is more pronounced when it comes to Middle Eastern consumers.
William Lauder, the firm’s executive chairman, said the company has been investing in new geographic opportunities since its inception, and that will continue.
“Today our sales are almost 70 percent outside North America, and 10 years ago it was the opposite,” said Lauder. And percentage will likely increase as the company expands internationally.
“We hope to be in Africa soon in a meaningful way,” Lauder told attendees. He later added that he has his eye on countries in Sub-Saharan Africa, including Kenya and Nigeria, where many of the wealthiest denizens now head to cities like London, Paris and New York to shop.
During the meeting Lauder and Freda deflected chatter that Procter & Gamble Co. may one day attempt to buy the Lauder company. When asked about the rumor by a shareholder, Lauder said, “I can categorically say to you ‘no.’ Next question.” Without missing a beat, Freda, who was standing to Lauder’s right, said, “Is Estée Lauder taking over Procter & Gamble?” Freda’s quip was followed by a round of applause from the audience and an equally quick “no” from Lauder.
Talk of P&G, Freda’s former employer, surfaced again when a shareholder asked if the ceo if he had a plan that he had saved from his stint at the consumer products giant which he could use to deal with softness in Italy, Spain, Russia and Switzerland. Freda quickly responded, “No. I have no Procter & Gamble plan that applies to Estée Lauder. William and I are using a pure Estée Lauder business model for this company.” In the case of Switzerland, where there is a currency issue, consumers are buying in France and Germany, he noted. “We are still selling to in a different place,” said Freda.
A new Joan Rivers coffee table book, titled “Joan Rivers Confidential,” gives readers never-before-seen photos and letters of the late comedian throughout her life. “Because of her drive to always be fresh, she kept records of every appearance, every performance, all the jokes that were used on TV, all the clothes that were worn,” said Rivers’ daughter Melissa. Here, Rivers poses at the “Tonight Show” in Tracy Mills in 1985. Read more about the book and see more photos at WWD.com. #wwdeye
After a career at New York hot spots like Narcissa, Dovetail and Nix, @chefjfraser has expanded to the West Village with The Loyal, a modernized take on an American brasserie. “And as I’ve gone through my career I’ve felt some departure from that kind of simple, straightforward [cooking]. This is meant to take on the idea of ‘what if the American brasserie was invented today?’” #wwdeye (📷: @chinseephoto)
@bellahadid and @lilyaldridge at @bulgariofficial’s celebration on Friday night, toasting the brand's new Peter Marino-designed flagship on Fifth Avenue. The two-part event included a cocktail party at the store followed by a dinner at a mystery location — the Met Cloisters. #wwdeye
From overseeing America’s fastest-growing speciality retailers to codifying cool, WWD talked to the women who are leading the way for the future of beauty. Check out our Instagram Stories to see how these women built today and are creating tomorrow. (📸: @hannah_khymych) #wwdbeauty
For @laperlalingerie's spring 2018 show, the brand chose to host their event at @thevenetianmacao. With Chinese megastars @bingbing_fan and @hubing in attendance, La Perla debuted a rock ‘n’ roll-inspired collection. The show marked the start of Sands Macao Fashion Week, which runs from October 19 to 24 — the city’s first such event. Pictured here are models backstage with glimmering eyes. #wwdfashion (📷: Cheuk-Yin To)
Trending for spring 2018: top stitch design. Gone are the days of stitch just for seams — designers are using the once-minimal detail to create strong decorative elements. (📷: Paola Testa; Styled by @andrew_shang) #wwdfashion
@tradesy is turning the concept of a showroom upside down with its new space in Santa Monica. Here, the company plans to hold events, art exhibits and a showcase rare fashion pieces like this Louis Vuitton boxing set. Get all the details on Tradesy’s first showroom on WWD.com. #wwdnews