Olaplex reported quarterly financial results for the first time Wednesday, and sales were up 81 percent.
Chief executive officer JuE Wong attributed the results to Olaplex’s multipronged strategy.
“We have always been very hunkered down, and to us, we needed to focus on the long term. Everything we have done continues to be almost a flywheel for us to continue to be successful,” Wong said in an interview on Wednesday. She added the company’s revamp of its website in April 2020 has helped the business, especially adding in more interactive abilities like diagnostic tools and the loyalty and subscription programs.
“The accumulation, the momentum, that flywheel continues to give us that runway,” Wong said. “We also continue to launch products that are incremental and non-cannibalizing,” she said. She used Olaplex’s 4p Shampoo, a toning shampoo that launched earlier this year, as an example of products that “serve a whole new customer base,” but don’t take away from existing product sales.
For the quarter, Olaplex posted net sales of $161.6 million, reflecting growth across distribution channels. Olaplex said professional sales increased 57.6 percent to $75 million; specialty retail sales grew 128.1 percent, to $46.3 million, and direct-to-consumer sales grew 86.9 percent to $40.3 million.
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Olaplex’s net income nearly doubled from the prior-year quarter, at $56.6 million, in the quarter.
Over this calendar year, Olaplex’s sales have more than doubled from the prior year. The company said that for the first nine months of the calendar year, net sales were $431.9 million, up 128 percent from the prior-year period, with net income of $151.5 million, compared to $5.8 million in the prior-year period.
For the fiscal year, Olaplex is projecting net sales between $580 million and $588 million, with adjusted net income between $263 million and $268 million.
Wong said that, so far, Olaplex has been able to work with logistics and manufacturing partners in order to work around supply chain issues. “The fact we are so highly productive that when we go to them and basically say we need to work with you to build inventory and at the same time drive efficiencies in pricing, because we are going to build inventory with our programming, there is no pushback,” Wong said. “In fact, they partner with us because it’s easier to work with us on four or five [stock keeping units] than somebody with 40 skus.” Olaplex has also extended its lead time, she said.
“We saw holiday season starting a lot earlier this year,” Wong said. Olaplex has released its seasonal holiday kits, which are already selling well, Wong said. This year’s holiday kit is the bestselling product in one of Olaplex’s retail partners, Wong said, unable to disclose which retailer.
She said customers are gifting hair care, as evidenced by varied shipping addresses that have shown up in online orders.
“Consumers are getting to a place where they realize the light at the end of the tunnel is not back to the normal. The light at the end of the tunnel is living with what is happening and having their lives no longer on wait, something better is going to happen, but let’s just roll with the punches,” Wong said. “People are willing to spend, and you saw that in the NPD data for the third quarter.”
Wong also said the company is continuing to prioritize sustainability initiatives, and is experimenting with printing instructions for professionals on the inside of boxes, instead of including an insert with them. Wong said that project may roll out in 2022.
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