Coty beats by $0.07, beats on revs; confirms P&G Beauty Brands merger targets :
- Reports Q4 (Jun) earnings of $0.13 per share, excluding non-recurring items, $0.07 better than the Capital IQ Consensus of $0.06; revenues rose 5.5% year/year to $1.08 bln vs the $1.05 bln Capital IQ Consensus, a 1% decline in the underlying business.
- Fragrances net revenue grew 2% as reported and 3% like-for-like, with growth in the segment supported by increases in each of the fragrance power brands. Color Cosmetics declined 4% as reported and 2% like-for-like, as growth in Rimmel and Bourjois was offset by declines in OPI. Skin & Body Care declined 9% as reported and 7% like-for-like, primarily driven by declines in Playboy and philosophy, partially offset by growth in adidas.
- By geographic region, net revenue in the Americas grew 12% as reported though declined 6% like-for-like, net revenues in EMEA were flat as reported though grew 2% like-for-like, and net revenues in Asia Pacific grew 4% as reported and 6% like-for-like. Coty remains focused on growing its power brands through innovation, strong support levels, digital engagement with consumers, and improved "in-market" execution.
- Guidance: For the Coty stand-alone business, the Company is targeting net revenue momentum to improve and return to growth in the second half of fiscal 2017, excluding foreign currency. With a focus on continuing to build a better business, the Company is targeting Coty stand-alone fiscal 2017 adjusted operating margin improvement on a constant currency basis, coupled with strong operating cash flow conversion.
- "Our preparation for the P&G Beauty Brands (PG) transaction is well advanced... We have completed the cost and cash synergy analysis for the merger, confirming earlier announced targets of total potential cost savings of $780 million over four years post transaction close."
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