Net revenues for the period were down by 2.6% on a like-for-like basis to $1.18bn, which represented a drop of 2.9% on a reported basis.
Reported net income was also down, falling by 8% to $93.6m compared to the corresponding period last year, while the adjusted net income was also down by 8%.
Company's overall performance in the Americas was down
The like-for-like decline in revenues was triggered by the company’s overall performance in the Americas, which saw a 10% decline, mainly from the slower performance of its nail and fragrance lines.
However, this poor performance was counterbalanced by a much stronger picture in other markets, with revenues from EMEA up 2%, while sales were up by 7% in the Asia Pacific region and by 8% in the emerging markets.
Declines in the Americas were mainly down to a poor performance of its Sally Hansen color cosmetics line, which was impacted by what the company described as a ‘sudden and sharp trend' inversion in the US nail market, together with increased competition.
Looking to the second half of the year for an uptick
Commenting on the results, Coty CEO Michele Scannavini said that the slowing market in the U.S. had triggered heavy trade destocking together with a slower pace of our ordering that affected the company’s mass market channels and the business overall.
“On the other hand, we are very pleased with our growth in the prestige channel and in the emerging markets, areas we had targeted for accelerated development,” he said.
The company says that it is anticipating a slow first half of the year, given the current market conditions, but believes that a refocusing on its power brands and color cosmetic lines, together with further acceleration in the emerging markets, should help to boost results in the second half of the year.