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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15 (d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
September 19, 2005
The Estee Lauder Companies Inc.
(Exact name of registrant as specified in its charter)
Delaware 1-14064 11-2408943
(State or other jurisdiction (Commission File (IRS Employer Identification
of incorporation) Number) No.)
767 Fifth Avenue, New York, New York 10153
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code
212-572-4200
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
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ITEM 7.01 Regulation FD Disclosure.
On September 19, 2005, The Estee Lauder Companies Inc. issued a press release
regarding its guidance expectations. A copy of the press release is attached
hereto as Exhibit 99.1 and is incorporated herein by reference.
ITEM 9.01 Financial Statements and Exhibits.
(c) Exhibits.
Exhibit No. Description
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99.1 Press release dated September 19, 2005 of The Estee Lauder
Companies Inc.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
THE ESTEE LAUDER COMPANIES INC.
Date: September 19, 2005 By: /s/RICHARD W. KUNES
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Richard W. Kunes
Executive Vice President
and Chief Financial Officer
(Principal Financial and
Accounting Officer)
THE ESTEE LAUDER COMPANIES INC.
EXHIBIT INDEX
Exhibit No. Description
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99.1 Press release dated September 19, 2005 of The Estee Lauder
Companies Inc.
Exhibit 99.1
THE News
ESTEE LAUDER Contact:
COMPANIES INC. Investor Relations:
Dennis D'Andrea
(212) 572-4384
767 Fifth Avenue Media Relations:
New York, NY 10153 Sally Susman
(212) 572-4430
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FOR IMMEDIATE RELEASE:
Estee Lauder Companies Reaffirms Outlook for Fiscal 2006 Full Year
Modifies First Half Expectations
New York, NY, September 19, 2005 - The Estee Lauder Companies Inc. (NYSE: EL)
today reaffirmed its previously announced guidance for sales and earnings per
share for its fiscal full year ending June 30, 2006 and revised its outlook for
its first half results.
For the 2006 full fiscal year, the Company continues to expect net sales in
constant currency to grow between 5.5% and 6.5% versus fiscal 2005. The Company
now expects foreign currency translation to negatively impact its reported
results by approximately 1%. At the same time the Company also continues to
expect to achieve diluted earnings per share of between $1.95 and $2.00 for the
fiscal 2006 year. This full year earnings per share estimate includes a slightly
more than $.14 per share impact from expensing stock-based compensation, as well
as a two to three cent per share estimated impact of potential store closures
and or business disruptions related to the merger of Federated Department
Stores, Inc. and The May Department Stores Company.
On its fiscal 2005 year end conference call on August 16, 2005, the Company
stated that it runs its business on an annual basis and acknowledged that it
does experience volatility in its quarterly results, due, in part, to the timing
of product launches and investment spending. The Company does not provide
quarterly guidance and continues to believe that its current policy of providing
half-year and full-year guidance best tracks the seasonality of its business.
However, the Company also believes it is in the best interest of both its
current and potential stockholders to communicate, when appropriate, significant
fluctuations in its expected fiscal quarterly results. With that in mind, net
sales for the first quarter of fiscal 2006 are expected to grow in the
low-single digits in constant currency. This expectation reflects soft sales
primarily in the Americas, where the Company has recently been impacted by
weakness at certain retailers, the general consumer response to higher oil and
gas prices, softness in the Southeast region due to the effects of Hurricane
Katrina and lower than expected sales from promotional programs. The combined
impact of these business conditions, the Company's planned product launches and
investment
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spending, as well as the timing of expensing of stock-based compensation,
is expected to result in the Company's fiscal 2006 first quarter net earnings
being significantly below the same prior-year period.
Notwithstanding the expected first quarter decline, the Company's business plan
reflects improvement in its fiscal second quarter. As a result of the
abovementioned business conditions, net sales for the first half of fiscal 2006
are now expected to grow between 5% and 6% in constant currency compared with
previous expectations of between 7% and 8%. Foreign currency translation is
estimated to negatively impact first half sales by approximately 1%, versus the
first half of fiscal 2005. The Company said that its estimate for earnings per
share for the first half of fiscal 2006 is now expected to be between $.87 and
$.92, including a $.10 impact from expensing stock based compensation.
The Company believes that with the product launches and programs in place for
the fiscal second half it will be able to recoup the expected first half sales
and earnings shortfall. Risks to the Company's current estimates include the
continued negative impact on its business resulting from Hurricane Katrina, as
well as the economic effect on raw material prices, consumer spending and the
retail environment in the U.S. caused by sustained high oil and gas prices.
Further risks include those listed below under "Forward-Looking Statements."
The Estee Lauder Companies Inc. President and CEO, William Lauder, and Executive
Vice President and CFO, Richard Kunes, will make a presentation tomorrow,
September 20th, at the Bank of America 35th Annual Investment Conference.
Investors may access a live webcast of this presentation on The Estee Lauder
Companies website at www.elcompanies.com on Tuesday, September 20th at 3:00 pm
PT.
Forward-Looking Statements
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The forward-looking statements in this press release, including those containing
words like "expect," "believe," "planned," "may," "could," "should,"
"anticipate" and "estimate" involve risks and uncertainties. Factors that could
cause actual results to differ materially from those forward-looking statements
include the following:
(1) increased competitive activity from companies in the skin care,
makeup, fragrance and hair care businesses, some of which have greater
resources than the Company does;
(2) the Company's ability to develop, produce and market new products on
which future operating results may depend;
(3) consolidations, restructurings, bankruptcies and reorganizations in
the retail industry causing a decrease in the number of stores that
sell the Company's products, an increase in the ownership
concentration within the retail industry, ownership of retailers by
the Company's competitors and ownership of competitors by the
Company's customers that are retailers;
(4) shifts in the preferences of consumers as to where and how they shop
for the types of products and services the Company sells;
(5) social, political and economic risks to the Company's foreign or
domestic manufacturing, distribution and retail operations, including
changes in foreign investment and trade policies and regulations of
the host countries and of the United States;
(6) changes in the laws, regulations and policies that affect, or will
affect, the Company's business, including changes in accounting
standards, tax laws and regulations, trade rules and customs
regulations, and the outcome and expense of legal or regulatory
proceedings, and any action the Company may take as a result;
(7) foreign currency fluctuations affecting the Company's results of
operations and the value of its foreign assets, the relative prices at
which the Company and its foreign competitors sell products in the
same markets and the Company's operating and manufacturing costs
outside of the United States;
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(8) changes in global or local conditions, including those due to natural
or man-made disasters or energy costs, that could affect consumer
purchasing, the willingness of consumers to travel, the financial
strength of the Company's customers or suppliers, the Company's
operations, the cost and availability of capital which the Company may
need for new equipment, facilities or acquisitions, the cost and
availability of raw materials and the assumptions underlying the
Company's critical accounting estimates;
(9) shipment delays, depletion of inventory and increased production costs
resulting from disruptions of operations at any of the facilities
which, due to consolidations in the Company's manufacturing
operations, now manufacture nearly all of the Company's supply of a
particular type of product (i.e., focus factories);
(10) real estate rates and availability, which may affect the Company's
ability to increase the number of retail locations at which the
Company sells its products and the costs associated with the Company's
other facilities;
(11) changes in product mix to products which are less profitable;
(12) the Company's ability to acquire or develop new information and
distribution technologies, on a timely basis and within the Company's
cost estimates;
(13) the Company's ability to capitalize on opportunities for improved
efficiency, such as globalization, and to integrate acquired
businesses and realize value therefrom;
(14) consequences attributable to the events that are currently taking
place in the Middle East, including terrorist attacks, retaliation and
the threat of further attacks or retaliation; and
(15) the impact of repatriating certain of the Company's foreign earnings
to the United States in connection with The American Jobs Creation Act
of 2004.
The Company assumes no responsibility to update forward-looking statements
made herein or otherwise.
The Estee Lauder Companies Inc. is one of the world's leading manufacturers and
marketers of quality skin care, makeup, fragrance and hair care products. The
Company's products are sold in over 130 countries and territories under
well-recognized brand names, including Estee Lauder, Clinique, Aramis,
Prescriptives, Origins, M.A.C, Bobbi Brown, Tommy Hilfiger, La Mer, Donna Karan,
Aveda, Stila, Jo Malone, Bumble and bumble, Darphin, Michael Kors, Rodan +
Fields, American Beauty, Flirt!, Good Skin(TM), Donald Trump The Fragrance and
Grassroots.
An electronic version of this release can be found at the Company's website,
www.elcompanies.com.
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