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Estee Lauder's Longtime CFO Travis to Depart Next Year

An Estee Lauder cosmetics counter is seen in Los Angeles, California, US, August 19, 2019. (Reuters)
An Estee Lauder cosmetics counter is seen in Los Angeles, California, US, August 19, 2019. (Reuters)
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Estee Lauder's Longtime CFO Travis to Depart Next Year

An Estee Lauder cosmetics counter is seen in Los Angeles, California, US, August 19, 2019. (Reuters)
An Estee Lauder cosmetics counter is seen in Los Angeles, California, US, August 19, 2019. (Reuters)

Estee Lauder said on Thursday that Tracey Travis would be stepping down and retiring from her 12-year role as the MAC lipstick maker's finance chief, effective June 30, 2025.

The company said a successor for Travis has been identified and will be named in the coming weeks. Travis will work closely with this person to ensure a smooth and successful transition, it added.

Travis, who has been Estee Lauder's CFO since Aug. 2012, had joined the company from Ralph Lauren, where she served as finance chief for over seven years.

Under her leadership, Estee Lauder has significantly strengthened financially, made extensive investments in innovation and digital transformation, and also made several acquisitions of companies including Tom Ford and Deciem, among others.

"Tracey has been instrumental in growing Estee Lauder from a $24 billion market cap company in 2012 to over $135 billion at peak," Jefferies analyst Ashley Helgans said in a note earlier on Thursday.

"A fresh set of eyes on the business could be beneficial given the recent volatility and would allow for the company to reset the growth algorithm," Helgans added.

The company had lowered its annual organic sales estimate in May on persistent softness in mainland China's prestige beauty space, even as a demand rebound for its pricey items in the US and Asia-Pacific markets drove a profit forecast raise.

Shares of Estee Lauder, which have dropped more than 30% this year, were marginally up in after-hours trading.

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Fashion

Hugo Boss May Push Back 2025 Targets as Luxury Sector Falters

The Hugo Boss logo is seen at one of the brand's stores in Hong Kong. CREDIT: BUDRUL CHUKRUT/AP
The Hugo Boss logo is seen at one of the brand's stores in Hong Kong. CREDIT: BUDRUL CHUKRUT/AP
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Hugo Boss May Push Back 2025 Targets as Luxury Sector Falters

The Hugo Boss logo is seen at one of the brand's stores in Hong Kong. CREDIT: BUDRUL CHUKRUT/AP
The Hugo Boss logo is seen at one of the brand's stores in Hong Kong. CREDIT: BUDRUL CHUKRUT/AP

Hugo Boss may push back key sales and profit targets beyond 2025 when it reports its second-quarter results on Thursday, as investors watch for updates on trading and cost-cutting plans.
Shares in the company fell as much as 10% in July as it cut its full-year sales and earnings forecasts, citing weakening global consumer demand, especially in China and Britain, said Reuters.
It warned in March that its target of reaching 5 billion euros ($5.4 billion) in annual revenues in 2025 might be delayed, but said it still expected its margin on earnings before interest and taxes (EBIT) to reach at least 12% next year.
"Besides comments on current trading, which will be closely watched by investors, we would not rule out an update on Hugo Boss' mid-term targets," said Felix Jonathan Dennl, analyst at Metzler Capital Markets in Frankfurt.
Some analysts, including Dennl, expect Hugo Boss to hit its mid-term sales target two to three years later than originally forecast, and to reach its mid-term EBIT margin goal after 2028.
"If Hugo Boss can't provide more visibility, the revenue and EBIT targets should be in doubt," Alexander Zienkowicz, senior analyst at Mwb Research said.
In an average of estimates last updated ahead of the company's preliminary results in mid-July, analysts had forecast sales of 4.65 billion euros and an operating profit of 519 million for 2025, corresponding to an EBIT margin of 11%.
Cost cuts are also going to be in focus, said Joerg Philipp Frey, analyst at Warburg Research. He highlighted the company's 21% jump in marketing spend and higher brick-and-mortar retail expenses in the second quarter from a year earlier, in contrast with its quarterly sales decline.
The upmarket fashion brand has been on an expansion drive, increasing marketing spend and opening 102 new points of sale, including own stores, "shop-in-shops" and outlets, in 2023. It is trying to stem a slowdown in sales growth which has contributed to the company's shares almost halving in value this year.
"To lift the share price, it will be important for Hugo Boss to demonstrate effective management of the issues at hand and a credible path to recovery," Zienkowicz said.
The luxury sector is grappling with weaker sales and pressure on margins as inflation-hit shoppers hold off from splashing out on designer fashion. A property slump and job insecurity in China has exacerbated the problem.
Earnings from luxury companies this quarter have demonstrated the strains that the sector is under with both LVMH and rival Kering falling short of forecasts.