Coty lifts profit forecast as luxury shoppers seek cosmetics, fragrances

Coty Inc (COTY.N) raised its annual profit forecast for the second time and beat quarterly revenue and earnings estimates, buoyed by the CoverGirl parent’s price hikes and steady demand for its high-end and affordable cosmetics and fragrances.

Shares of Coty, which is planning for a dual listing in Paris, climbed about 2% in premarket trading.

The results reflect the recent trend of luxury shoppers indulging in lipsticks and fragrances even as they shun high-end purchases amid rising interest rates and product prices.

Coty signaled that retailers were restocking after keeping a tight leash on inventories in the previous quarters.

“Our retailers are now rebuilding and reordering. At the end of the third quarter, the level of inventory was very healthy,” Chief Financial Officer Laurent Mercier told Reuters.

Coty said a post-pandemic recovery in travel retail extended into the quarter. The segment is an area of focus for luxury companies where customers snap-up products from duty-free stores at airports and major shopping districts like Hainan in China.

This report’s information was first seen on REUTERS; to read more, click this link.