E.l.f. Beauty ended the fiscal year on a high note, but chief executive officer Tarang Amin expects the business will see more of an impact from the coronavirus pandemic in the next quarter.
The beauty business saw net sales up 6 percent for the fiscal year ended March 31, to $282.9 million, driven by increased productivity across retail and e-commerce channels. Earnings increased slightly, to $62.6 million from $62.4 million. Adjusted net income was 63 cents per diluted share.
For the most recent quarter, E.l.f.’s net sales increased 13 percent to $74.7 million. Earnings dipped slightly, to $11.7 million from $12 million in the prior-year period, and adjusted net income was 10 cents a diluted share.
E.l.f. has since seen sales affected due to the COVID-19 pandemic.
“The last two weeks in March we saw a pretty big falloff related to COVID-19,” Amin said.
“Our e-commerce sales and those of our retailer dot-coms are up triple digits during COVID-19,” Amin said. “Conversely, consumer behavior, both with the shelter in place, using less makeup and skin care, as well as when they do go to retailers, I think they’ve been more focused on essential categories. But it’s highly volatile. We saw pretty big dropoffs in that first four weeks of COVID-19, since then we’ve actually seen some better results, but we also attribute that to the stimulus checks.”
On the product front, E.l.f. has built franchises around hero launches like Putty Primer and Camo Concealer, and has recently launched two CBD skin-care lines that Amin said are doing well. E.l.f. has a Cannabis Sativa line at Target, and will be launching its full-spectrum CBD skin care with Ulta Beauty, Amin said. “Those are doing really well,” he said.
“Our business is certainly down during the COVID[-19] crisis, but one of the things we’re really keenly intent and focused on is our relative performance to the category, at least in the four weeks ending April 18 we grew share — our share went up to 5.2 percent, up 60 basis points.”
Amin said E.l.f. is now a top-five brand in mass, per Nielsen, Amin said.
“We’re really focused, like everyone else, on as the economy starts to open back up, what happens to consumer behavior,” Amin said, adding that he hopes the company will be well-positioned to bounce back.
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