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Estee Lauder forecasts dour 2023 due to China COVID-19 lockdowns

Estee Lauder forecasts dour 2023 due to China COVID-19 lockdowns

An Estee Lauder cosmetics counter is seen in Los Angeles, California on Aug 19, 2019. (Photo: Reuters/Lucy Nicholson)

Estee Lauder on Thursday (Aug 18) forecast full-year sales and adjusted profit below estimates, due to a hit from COVID-19-related lockdowns in major market China.

The country, which recently eased its zero-COVID policy, has seen a spike in cases, and subsequent restrictions have left companies with presence in the country stuck with piles of unsold stock as cautious consumers stay away from crowded shopping districts.

Estee also faces pressure from China's tourism hub Hainan that extended lockdowns in the past week, effecting its brands.

The company expects full-year 2023 net sales to increase between 3 per cent and 5 per cent, compared with analysts' average estimate of a 7.6 per cent rise, according to IBES data from Refinitiv.

Estee also sees full-year 2023 adjusted profit per share to increase between 5 per cent and 7 per cent, below estimates of a 10.5 per cent gain.

Shares of the New York-based company were down 3 per cent in premarket trading.

Source: Reuters/zl

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