The company said that group sales, which also includes its world famous Tupperware kitchenware brand, grew 7 per cent on a reported basis in the 13 weeks up to June 26, up from $524.7m in the same period last year, to $565.1m.
The result was marred by the reversal of $4m in sales from the company’s Russian operations that had been wrongly attributed to the quarter, which meant that the reported sales actually grew by 6 percent, instead of 7 percent.
Net income shows big rise
Overall net income grew sharply, thanks to currency gains and the stronger results in the emerging markets. The figure was up from $33.1m in the corresponding quarter last year, to reach $57.9m for the current quarter.
Beauty sales in North America were up by 3 per cent on a reported basis, but down 2 per cent when taking into account the negative impact of currency translations, to $103.1m.
Developing markets save the day
Sales in other regions, which mainly account for developing markets, were up by 7 per cent on a reported basis and 15 per cent when considering the positive impact of currency, to reach $79.4m.
The results were led by huge gains in the Brazil market, where sales were up 38 per cent in local currencies, and by 62 per cent on a reported basis. Significant gains were also noted in the Philippines, Venezuela and Argentina.
Overall the company says it currently derives approximately 56 per cent of its business from developing markets, and also stated that these markets are helping to drive growth across the business, as well as propping up weaker results in the US and Europe.
BeautiControl continues recruitment drive
The company said that in North America its BeautiControl division continues to focus on sales force training to reinforce its direct sales business, which has proved particularly successful for the Fuller Mexico division.
Based on the results, the company is sticking to its April guidance that group currency sales growth would be in region of 6 to 8 percent, while highlighting its belief that the Beauty business outside of North America would continue to grow in the mid-teens.
Analysts said that the Q2 results were below expectations and stock prices plunged 12 percent in trading yesterday.