Coty Inc. (NYSE:COTY) Q2 2023 Earnings Call Transcript

Operator: Our last question comes from Carla Casella from J.P. Morgan.

Carla Casella: Hi. Thank you. You talked about Prestige high single-digit growth, in mass, mid-single digit. Can you talk about how much of that was new doors? Or is that mostly just pure sell-through of kind of the new products you’ve been talking about?

Laurent Mercier: Yes. Hi. So, basically, the model we are using for Prestige and Consumer Beauty, so this is mostly organic growth, also definitely either Prestige and Consumer Beauty. But definitely, if I take the case of Consumer Beauty, now step by step, we are seeing that we are getting shelf space. So, definitely, that success of innovation, acceleration of rotation by all these elements step-by-step, we are regaining traction first with consumers and retailers and this giving us absolutely all the ammunition now to gain shelf space. So that’s really — we are building. So, done in a healthy way. That’s really back always we talk about discipline that we are doing definitely with marketing teams either Consumer Beauty or Prestige.

We are really focusing on productivity (ph). And that’s — again, we’re thinking about the right productivity progress with absolute KPI. Once we optimize productivity progress, then, of course, we are working on new doors, but with very selective criteria that we’re entering new doors only and if only we have guarantees that productivity is really at target level.

Operator: And we’ve reached our allotted time for question-and-answer session. I will now turn the program back over to our speakers for any additional or closing remarks.

Sue Nabi: Yes. Thank you, everyone, for your questions. If you allow me a few closing remarks, the first one is about the category, beauty is and will continue to be the darling category of consumers around the world for all the regions we have mentioned during this earnings call. Please see Coty in its reinvention Stage 2 phase, entering into real innovation, fantastic ROI behind advertising, new white spaces in terms of regions, categories, including skincare and, of course, targeting leverage by about 3x at the end of this calendar. Last but not least, I would say that even Coty is not in its maturity stage. As you can imagine, we will continue to grow given all the white spaces that we’re having. And the last remark is that it’s very important that the long-term vision and view is really the one that is at play at Coty, and we are building this company for the coming, I would say, decades to become a true beauty power house. Thank you very much.

Operator: Thank you, ladies and gentlemen. This concludes today’s teleconference. You may now disconnect.