Stock Analysis on Net
Stock Analysis on Net

Estée Lauder Cos. Inc. (NYSE:EL)

This company has been moved to the archive! The financial data has not been updated since August 18, 2023.

Common-Size Income Statement
Quarterly Data

Estée Lauder Cos. Inc., common-size consolidated income statement (quarterly data)

Microsoft Excel
3 months ended: Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019 Dec 31, 2018 Sep 30, 2018 Jun 30, 2018 Mar 31, 2018 Dec 31, 2017 Sep 30, 2017
Net sales 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00
Cost of sales -32.22 -30.90 -26.39 -26.03 -28.95 -23.42 -22.08 -24.07 -25.05 -24.30 -22.34 -23.16 -31.56 -24.99 -22.51 -23.31 -23.26 -21.88 -22.72 -23.35 -21.15 -20.27 -20.11 -21.72
Gross profit 67.78% 69.10% 73.61% 73.97% 71.05% 76.58% 77.92% 75.93% 74.95% 75.70% 77.66% 76.84% 68.44% 75.01% 77.49% 76.69% 76.74% 78.13% 77.28% 76.65% 78.85% 79.73% 79.89% 78.28%
Selling, general and administrative -67.05 -60.81 -56.93 -57.10 -65.54 -53.59 -52.09 -54.51 -66.31 -55.51 -53.37 -56.88 -77.53 -60.69 -54.89 -56.10 -67.47 -57.96 -56.35 -56.98 -69.44 -62.11 -59.13 -59.90
Restructuring and other charges -0.86 -0.37 -0.17 -0.05 -2.58 -0.52 -0.23 -0.14 -0.81 -3.39 -0.72 -0.17 -0.78 -0.72 -0.15 -0.59 -3.26 -0.77 -0.72 -1.16 -1.00 -2.88 -1.79 -1.04
Goodwill impairment 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 -1.11 0.00 -1.07 -8.22 -11.05 0.00 0.00 -1.28 -0.50 0.00 0.00 0.00 0.00 0.00
Impairment of other intangible assets 0.00 0.00 -4.48 0.00 -0.70 -5.09 0.00 0.00 -1.88 -0.85 -0.56 0.00 -11.40 -2.12 -5.75 0.00 0.00 -0.11 -0.45 0.00 0.00 0.00 0.00 0.00
Operating expenses -67.91% -61.18% -61.58% -57.15% -68.83% -59.20% -52.32% -54.64% -69.00% -59.76% -55.76% -57.05% -90.78% -71.75% -71.84% -56.69% -70.72% -60.12% -58.03% -58.14% -70.44% -64.99% -60.92% -60.93%
Operating income -0.14% 7.92% 12.03% 16.82% 2.22% 17.39% 25.60% 21.29% 5.95% 15.94% 21.90% 19.79% -22.35% 3.26% 5.64% 20.00% 6.02% 18.00% 19.25% 18.50% 8.41% 14.75% 18.96% 17.35%
Interest expense -2.74 -1.55 -1.13 -1.17 -1.18 -0.97 -0.76 -0.96 -1.07 -1.11 -0.89 -1.26 -2.02 -1.26 -0.82 -0.82 -0.89 -0.85 -0.87 -0.96 -0.97 -0.98 -0.85 -0.95
Interest income and investment income, net 1.47 0.99 0.56 0.38 0.31 0.12 0.18 0.09 0.28 0.23 0.35 0.39 0.29 0.42 0.28 0.36 0.45 0.40 0.30 0.43 0.49 0.47 0.32 0.37
Other components of net periodic benefit cost 0.08 0.11 0.04 0.08 0.00 0.02 0.04 -0.02 0.00 -0.05 -0.14 -0.08 -0.04 -0.03 -0.02 -0.03 -0.03 -0.03 0.00 0.00 0.00 0.00 0.00 0.00
Other income 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.02 21.52 0.00 0.00 0.00 -0.78 0.00 12.46 0.00 0.00 1.90 0.00 0.00 0.00 0.00 0.00 0.00
Earnings before income taxes -1.33% 7.46% 11.52% 16.11% 1.35% 16.56% 25.06% 20.42% 26.68% 15.01% 21.22% 18.84% -24.90% 2.39% 17.54% 19.51% 5.54% 19.42% 18.68% 17.96% 7.92% 14.24% 18.43% 16.77%
Provision for income taxes 0.44 -3.33 -2.92 -3.64 0.06 -3.06 -5.38 -4.60 -0.89 -3.16 -3.15 -4.10 6.01 -2.51 -5.41 -4.16 -1.14 -4.54 -4.27 -3.72 -2.22 -3.15 -15.09 -3.63
Net earnings (loss) -0.89% 4.13% 8.59% 12.47% 1.40% 13.50% 19.68% 15.82% 25.79% 11.85% 18.07% 14.74% -18.89% -0.12% 12.13% 15.35% 4.40% 14.88% 14.41% 14.25% 5.71% 11.10% 3.34% 13.13%
Net (earnings) loss attributable to noncontrolling interests and redeemable noncontrolling interest -0.03 0.03 -0.06 -0.03 0.06 -0.35 -0.04 -0.07 0.08 -0.05 -0.08 -0.06 -0.12 -0.06 -0.09 -0.08 -0.03 -0.05 -0.10 -0.06 -0.06 -0.06 -0.05 -0.09
Net earnings (loss) attributable to The Estée Lauder Companies Inc. -0.91% 4.16% 8.53% 12.44% 1.46% 13.14% 19.64% 15.76% 25.86% 11.80% 17.99% 14.68% -19.01% -0.18% 12.05% 15.28% 4.37% 14.82% 14.31% 14.19% 5.64% 11.04% 3.29% 13.04%

Based on: 10-K (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-K (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-K (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-K (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-K (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-K (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30).

A comprehensive analysis of the common-size income statement reveals a period of significant volatility in profitability, characterized by a long-term erosion of gross margins and periodic spikes in operating expenses. While the company maintained strong margins in the early part of the analyzed period, the latter years show a marked deterioration in both operating and net earnings.

Gross Profitability and Cost of Sales
Gross profit margins exhibited a general downward trajectory over the observed period. Initial margins remained stable between 76% and 80% from late 2017 through 2019. However, a significant dip occurred in June 2020, where gross profit fell to 68.44% due to the cost of sales rising to 31.56%. Although a partial recovery followed, a secondary decline began in 2022, culminating in a period low of 67.78% by June 2023. This suggests an increasing pressure on the cost of goods sold relative to net sales.
Operating Expenses and Asset Impairments
Operating expenses demonstrate extreme volatility, frequently peaking in the second quarter of the calendar year. Selling, general and administrative (SG&A) expenses remained relatively consistent around 55-60% of sales, with the exception of severe spikes, most notably in June 2020 when SG&A reached 77.53% of net sales. Furthermore, the period between 2018 and 2022 was marked by substantial non-cash charges; goodwill and intangible asset impairments were particularly acute in early 2020, with goodwill impairment reaching 11.05% of net sales in March 2020 and intangible asset impairment hitting 11.40% in June 2020.
Operating and Net Income Margins
Operating income margins fluctuated widely, reflecting the impact of the aforementioned expense spikes and impairments. Margins peaked at 25.60% in December 2021 but plummeted to a low of -22.35% in June 2020. By June 2023, operating income had declined to -0.14%, indicating a near-total erasure of operating profitability. Net earnings followed a similar pattern, moving from highs of 25.86% (June 2021) to a net loss of 0.91% by June 2023.
Financial Costs and Other Income
Interest expenses remained relatively stable for several years, generally fluctuating between 0.8% and 1.2% of net sales. However, a recent upward trend is observable, with interest expenses climbing to 2.74% by June 2023. Other income showed sporadic and significant impacts, specifically a peak of 21.52% in June 2021, which temporarily bolstered earnings before income taxes despite underlying operational pressures.

The overall financial trend indicates a transition from a high-margin operational model to one facing mounting cost pressures. The convergence of rising cost of sales, increasing interest expenses, and volatile SG&A spending has resulted in a compression of net margins, leading to a net loss in the final quarter of the analyzed sequence.

AI Ask an analyst for more

Hi, I’m an AI-powered financial analyst at Stock Analysis on Net.

How can I help you?