Olaplex is plotting another major year.
On the heels of 2021, when the company more than doubled net sales to $598.4 million, bond-building hair brand Olaplex is predicting between $796 million and $826 million in net sales for 2022, the company said Tuesday, when it reported earnings.
Deeper distribution is a major part of that predicted growth. Olaplex launched in stores with Ulta Beauty at the start of this year, following the 2021 salon distribution at Ulta salons. With Sephora, Olaplex will expand from 200 Sephora at Kohl’s locations to 650 in 2022 and grow its store count in Europe from 400 to 800 doors. With Douglas in Germany, where the brand had been sold online, Olaplex will launch in its first 100 retail doors.
“It’s not us going out and looking for new doors and new accounts just because. We are just growing our relationship deeper,” chief executive officer JuE Wong said in an interview with WWD. “We are doubling our store count with Sephora in Europe. In Europe, not all their doors have hair care.”
During 2021, Olaplex’s salon-based sales made up the largest portion of its business, at 43.3 percent, or $259 million. Specialty retail grew 246.6 percent during the year to $176 million, making up about 29.4 percent of sales. Direct-to-consumer sales made up 27.3 percent of the business, with $163 million, a 117 percent uptick over the prior year.
You May Also Like
Going forward, Wong said Olaplex is partnering with more distributors in Europe to expand the professional side of the business there. Online, Olaplex has built out regional websites for several markets, including the U.K., Australia, Italy and Spain.
“We are launching those markets and having our own olaplex.com will allow us to gain more insights to the consumers and be able to serve them better,” Wong said.
For the fourth quarter, Olaplex posted net sales of $166.5 million, a 78.7 percent increase from the prior-year period. Net income was $69.3 million. Net income for the full year was $220.8 million.
On the company’s earnings call Tuesday, Wong said the company’s hair-repair products have given Olaplex a “vast opportunity from which to grow.” Olaplex had several bestselling products in 2021, including No. 8 Bond Intense Moisture Mask and shampoo and conditioner.
Wong acknowledged competition in the hair market is heating up, but said it can also lead to growing interest in the hair care category. “This benefits Olaplex, as we can leverage our leadership position to continue to disrupt,” Wong said.
She also addressed lilial, a fragrance ingredient now banned in the European Union that had been included in Olaplex No. 3 Bond Smoothing Treatment product. The product’s reformulation was complete in June 2021, when production on a lilial-free version of No. 3 began — as of January, that’s the only version of No. 3 that’s been shipped to the EU, Wong said. The EU banned lilial because of fertility concerns if ingested.
It is also being phased out of products that are sold in the U.S. and globally — while some products that contain the ingredient may still be on store shelves, Olaplex is no longer manufacturing products that contain lilial, the company said.
“We will continue to really manage this transition plan in full compliance with applicable regulatory requirements,” Wong said. “We can control the production, but what we can’t control is what is already in some of the products on the shelves. We just want to be very clear that this is a phaseout.”
FOR MORE FROM WWD.COM, SEE: