Puig restructures and revises growth plans
Like many of its industry peers, the Puig group has suffered from the impact of Covid-19. Having completed one of the most important acquisitions since the start of the pandemic with its purchase of a majority stake in the Charlotte Tilbury brand for 1 billion euros in June, the Catalonian company has published its financial predictions for the future. Due to the decline in sales caused by the coronavirus crisis, the group expects its annual sales to reduce to 1.5 billion euros this year, down 26% from the 2.0 billion euros achieved in 2019.
"As the effects of Covid-19 start to recede, Puig expects a significant upturn in its business in 2021, which will exceed the 2.0 billion euros achieved in 2019," said the Spanish conglomerate in a release published on Wednesday, 9 December. In this way, the company hopes to limit the damage done to sales during the current fiscal year, in order to build up momentum in 2021 and hit its goal of 3.0 billion euros in revenues in 2023.
According to the company's predictions, this figure should rise to 4.0 billion euros in 2025. Puig therefore expects that, within five years, Paco Rabanne and Carolina Herrera will each achieve 1.0 billion in revenues. By then, sales at Isdin and Charlotte Tilbury should also rise to 500 million euros, while other businesses, such as the Jean Paul Gaultier, Penhaligon's, Dries Van Noten, Uriage, Apivita and L'Artisan Parfumeur brands and the Christian Louboutin license are predicted to be posting between 100 million and 500 million euros in revenues.
"In this context, the company predicts significant growth thanks to digital penetration and growth in China, which will account for 30% and 25% of sales, respectively, in 2025," explained the group, which is owned by the Puig family. The company also stated that it has signed agreements which will "allow it to achieve majority positions in companies where it currently has a minority presence," as in the case of Colombia's Loto del Sur and India's Kama Ayurveda.
A renewed company structure
Beauty and Fashion, Charlote Tilbury and Derma: these are the three divisions recently created by Puig, with which the company will start to work from 1 January 2021. The first will be made up of the Paco Rabanne, Carolina Herrera, Jean Paul Gaultier, Nina Ricci, Dries Van Noten, Penhaligon's and L'Artisan Parfumeur brands, as well as the company's beauty licenses for Christian Louboutin and Comme des Garçons Parfums, and lifestyle labels Adolfo Domínguez, Antonio Banderas, Shakira and Benetton. According to Puig, the fragrance business of these brands puts the company in fifth place in the global selective perfumery ranking, with a market share of 10%.
Secondly, the Charlotte Tilbury beauty brand will have its own dedicated division. And last of all, the Derma division will include the Uriage and Apivita brands, in which Puig owns a majority stake, as well as the company's 50% stake in Isdin. "Together these three brands make Puig the third largest player in the European pharmacy-sold dermocosmetics sector," explained the company.
Founded in 1914 by the family of the same name, Puig is currently led by Marc Puig. In 2019, the group saw its annual revenues rise 5% to 2.0 billion euros. At the present time, the Barcelona-based company distributes its products in 150 international markets.
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