Estée Lauder Companies Inc. (EL) Q2 2023 Earnings Call Transcript

Estée Lauder Companies Inc. (NYSE:EL) Q2 2023 Results Conference Call February 2, 2023 9:30 AM ET

Company Participants

Rainey Mancini - SVP, IR

Fabrizio Freda - President, CEO

Tracey Travis - EVP, CFO

Conference Call Participants

Lauren Lieberman - Barclays

Dara Mohsenian - Morgan Stanley

Peter Grom - UBS

Michael Binetti - Credit Suisse

Mark Astrachan - Stifel

Operator

Good day, everyone, and welcome to the Estee Lauder Company's Fiscal 2023 Second Quarter Conference Call. Today's call is being recorded and webcast.

For opening remarks and introductions, I would like to turn the call over to the Senior Vice President of Investor Relations, Ms. Rainey Mancini.

Rainey Mancini

Hello. On today's call are Fabrizio Freda, President and Chief Executive Officer; and Tracey Travis, Executive Vice President and Chief Financial Officer. Since many of our remarks today contain forward-looking statements, let me refer you to our press release and our reports filed with the SEC, where you'll find factors that could cause actual results to differ materially from these forward-looking statements.

To facilitate the discussion of our underlying business, the commentary on our financial results and expectations is before restructuring and other charges and adjustments disclosed in our press release. Unless otherwise stated, all organic net sales growth also excludes an noncomparable impacts of acquisitions, divestitures, brand closures and the impact of foreign currency translation. You can find reconciliations between GAAP and non-GAAP measures in our press release and on the Investors section of our website.

As a reminder, references to online sales include sales we make directly to our consumers through our brand.com sites and through third-party platforms. It also includes estimated sales of our products through our retailers' websites. [Operator Instructions]

And now I'll turn the call over to Fabrizio.

Fabrizio Freda

Thank you, Rainey, and hello to everyone. It is good to be with you today. Turning to results. For the second quarter of fiscal year 2023, organic sales fell 11% and which was within our outlook despite the incremental pressure of COVID-19 resurgence in China.

Many developed and emerging markets globally outperformed our expectations to offset the COVID-related impacts of significantly reduced retail traffic as well as limited staffing in beauty adviser, in domestic China and Travel Retail in Hainan in November and December. Adjusted EPS fell 45%. While its deep decline, this was meaningfully better than our outlook, driven by both disciplined expense management and moderation of the stronger U.S. dollars.