Beauty Sector Looks Promising Amid COVID-19

COVID-19 stay-at-home orders forced the closure of non-essential businesses, hurting the supply chain and travel-focused industries the most. The beauty sector, however, managed to stay relatively strong amidst the pandemic closures.

The following is a look at COVID's impact on some of the most well-known beauty companies. 

Shiseido Company

One of the oldest cosmetic companies, Shiseido Company Limited (OTC:SSDOY), withdrew its guidance for the fiscal year after the pandemic had a significant impact on net sales and operating profit, which were down 16% and 83% respectively. The firm's e-commerce business, on the other hand, was buoyed by an aggressive growth and media strategy. 

Procter & Gamble

Despite retail closures netting losses, Proctor & Gamble Co (NYSE:PG) organic sales lifted 1%, making it the 17^th consecutive quarter of increase.

Ulta Beauty

Ulta Beauty Inc (NASDAQ:ULTA) is reporting its first-quarter earnings on May 28^th. In 1990, the Company reinvented the beauty shopping experience through product consolidation. Despite COVID-19, expectations are positive due to the firm's recent emphasis on mobile and e-commerce services, as well as curbside pickup.

L'Oréal SA 

L'Oréal (OTC:LRLCY), in response to the current crisis, created ‘L'Oréal For the Future', a program that will invest €50 million to support women, along with €100 million to support the environment. The company's generosity and breadth of beauty care products suggest the firm is equipped to weather prolonged turmoil.

Coty Inc 

Despite missing estimates, Coty Inc (NYSE:COTY) is determined to survive. The firm announced a strategic partnership that will provide $750 million. Additionally, Coty will carve out its Wella brand into a standalone company in which KKR & Co Inc (NYSE:KKR) will acquire a 60% stake and make an incremental convertible preferred investment of $250 million. Together, this agreement will result in significant deleveraging of Coty's balance sheet, which will position the company for long-term growth as it will now have what it takes to invest in its core business.

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