EL

By Paulo Trevisani

Estee Lauder Cos. said Thursday a stronger dollar had a negative impact on net sales and operating income in its fiscal second quarter, while forex is expected to remain unfavorable.

The company forecast foreign currency having a 4% negative impact on net sales in full fiscal 2023. It expects net sales to decline between 7% and 5% versus the prior year.

About the last quarter, President and Chief Executive Fabrizio Freda cited a "moderation of the stronger U.S. dollar" as a factor helping the company beat earnings expectations.

Estee Lauder said forex contributed to net sales falling 17% in the quarter ended Dec. 31 from a year earlier, to $4.6 billion. It said reported net sales were negatively affected by 5% of foreign-currency translation.

The New York-based cosmetics supplier said currency conversion was unfavorable by 10% in Asia Pacific and Europe and 4% in Middle East and Africa.

The WSJ Dollar Index rose 7.8% last year, according to Dow Jones Market Data, as the U.S. Federal Reserve increased interest rates faster than its global counterparts. But in the fourth quarter it fell 7%, as other central banks started to catch up. So far this year, the gauge is down 2%.

Write to Paulo Trevisani at paulo.trevisani@wsj.com

(END) Dow Jones Newswires

February 02, 2023 11:46 ET (16:46 GMT)

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