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    Estee Lauder Companies Inc (EL)

    CEO Change
    Board Change

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    The Estée Lauder Companies Inc. is a leading global manufacturer, marketer, and seller of prestige beauty products, including skin care, makeup, fragrance, and hair care, distributed in approximately 150 countries and territories . The company operates under well-known brand names such as Estée Lauder, Clinique, M·A·C, Bobbi Brown, La Mer, Aveda, Jo Malone London, and others . Leveraging consumer analytics and insights, the company drives innovation and maintains a broad, inclusive range of products to compete effectively in the prestige beauty market .

    1. Skin Care - Develops and markets a wide range of skin care products, with significant contributions from brands like Estée Lauder, Clinique, and Dr.Jart+ .
    2. Makeup - Offers a variety of makeup products, with key offerings from brands such as M·A·C and Estée Lauder .
    3. Fragrance - Produces and sells fragrances, with notable contributions from Le Labo and Jo Malone London .
    4. Hair Care - Provides hair care products, primarily through the Aveda brand .
    5. Other Products - Includes a diverse range of additional beauty products beyond the main categories .
    NamePositionStart DateShort Bio
    Roberto CanevariExecutive Vice President – Global Supply Chain2021Roberto Canevari joined Estée Lauder in 2021. Previously, he was EVP, Supply Chain, Europe, at Unilever PLC and Chief Supply Chain Officer at Burberry Group PLC .
    Stéphane de La FaverieUpcoming President and Chief Executive OfficerJanuary 1, 2025Stéphane de La Faverie joined Estée Lauder in January 2011. He is currently Executive Group President and will become President and CEO on January 1, 2025 .
    Fabrizio FredaCurrent President and Chief Executive OfficerJuly 2009Fabrizio Freda has been President and CEO since July 2009. He was previously President and COO and held various positions at Procter & Gamble .
    Carl HaneyExecutive Vice President, Global Research Product and Innovation OfficerN/ACarl Haney has been with Estée Lauder for more than five years as of August 12, 2024 .
    Jane Hertzmark HudisExecutive Group PresidentJuly 12, 2018Jane Hertzmark Hudis has been with Estée Lauder for more than five years and continues under an employment agreement effective July 12, 2018 .
    Peter JueptnerPresident, InternationalFebruary 1, 2022Peter Jueptner became an executive officer on July 1, 2022, and assumed the role of Group President, International on January 1, 2023 .
    Jane LauderExecutive Vice President, Enterprise Marketing and Chief Data Officer1996Jane Lauder began her career at Clinique in 1996 and has held various leadership positions. She has been a Director since 2009 .
    Leonard A. LauderChairman EmeritusN/ALeonard A. Lauder is Chairman Emeritus and has been involved with the company since its early days .
    Ronald S. LauderChairman of Clinique Laboratories, LLC and Director2016Ronald S. Lauder joined Estée Lauder in 1964 and has served in various roles. He rejoined the Board in 2016 .
    William P. LauderExecutive ChairmanJuly 1, 2010William P. Lauder has been Executive Chairman since July 1, 2010, and will step down after November 8, 2024, but continue as Chair of the Board .
    Michael O’HareExecutive Vice President – Global Human ResourcesN/AMichael O’Hare has been with Estée Lauder for more than five years as of August 12, 2024 .
    Tracey T. TravisExecutive Vice President and Chief Financial OfficerAugust 20, 2012Tracey T. Travis has been CFO since August 20, 2012, and will retire effective June 30, 2025. She will transition to Senior Adviser until her retirement .
    Meridith WebsterExecutive Vice President – Global Communications and Public Affairs2021Meridith Webster joined Estée Lauder in 2021. She previously held roles at The White House, Vox Media, and Emerson Collective .
    Rashida La LandeExecutive Vice President and General CounselAugust 19, 2024Rashida La Lande became EVP and General Counsel on August 19, 2024. She previously worked at The Kraft Heinz Company and Gibson, Dunn & Crutcher .
    Akhil ShrivastavaExecutive Vice President and Chief Financial OfficerNovember 1, 2024Akhil Shrivastava became CFO on November 1, 2024. He has been with Estée Lauder for more than five years prior to his appointment .
    1. Given the ongoing declines in the prestige beauty industry in China and Asia travel retail, and your expectation for continued softness in fiscal 2025, can you elaborate on the specific actions you are taking to regain momentum in these markets and how confident you are in the timing of their recovery?

    2. With the announcement of your retirement at the end of the fiscal year and the search for your successor underway, how are you ensuring that the leadership transition will not disrupt the execution of your strategic reset and the Profit Recovery and Growth Plan?

    3. You mentioned the need to accelerate margin expansion despite facing sales declines and fixed expense deleverage; can you provide more details on how you plan to achieve this without compromising necessary investments in consumer-facing activities, especially in highly competitive markets like North America and China?

    4. Given the underperformance in the skin care category and the increased competition, what are the key initiatives you are implementing to reignite growth in skin care, and how will these initiatives differentiate you from competitors who are likely not pulling back investments?

    5. Regarding the execution of your strategy in some key areas of the business that has not met expectations, can you identify specific execution gaps and detail how the PRGP and organizational changes will address these issues to improve performance in fiscal 2025?

    Program DetailsProgram 1
    Approval DateOctober 31, 2018
    End Date/DurationNo expiration date
    Total additional amount256.0 million shares
    Remaining authorization amount25,073,242 shares
    DetailsAuthorized to repurchase shares of Class A Common Stock in the open market or in privately negotiated transactions
    YearAmount DueDebt TypeInterest Rate% of Total Debt
    2024$5002.000% Senior Notes2.000% 6.4% = (500 / 7,815) * 100
    2024$4Other Current BorrowingsN/A 0.1% = (4 / 7,815) * 100
    2027$4993.150% Senior Notes3.150% 6.4% = (499 / 7,815) * 100
    2028$6974.375% Senior Notes4.375% 8.9% = (697 / 7,815) * 100
    2029$6442.375% Senior Notes2.375% 8.2% = (644 / 7,815) * 100
    2030$6232.600% Senior Notes2.600% 8.0% = (623 / 7,815) * 100
    2031$5641.950% Senior Notes1.950% 7.2% = (564 / 7,815) * 100
    2033$6954.650% Senior Notes (May)4.650% 8.9% = (695 / 7,815) * 100
    2033$1985.750% Senior Notes (October)5.750% 2.5% = (198 / 7,815) * 100
    2034$6445.000% Senior Notes5.000% 8.2% = (644 / 7,815) * 100
    2037$2956.000% Senior Notes6.000% 3.8% = (295 / 7,815) * 100
    2042$2473.700% Senior Notes3.700% 3.2% = (247 / 7,815) * 100
    2045$4544.375% Senior Notes4.375% 5.8% = (454 / 7,815) * 100
    2047$4944.150% Senior Notes4.150% 6.3% = (494 / 7,815) * 100
    2049$6373.125% Senior Notes3.125% 8.2% = (637 / 7,815) * 100
    2053$5915.150% Senior Notes5.150% 7.6% = (591 / 7,815) * 100

    Competitors mentioned in the company's latest 10K filing.

    • L’Oréal S.A.; Unilever; Procter & Gamble; LVMH Moët Hennessey Louis Vuitton; Chanel S.A.; Beiersdorf; Shiseido Company, Ltd.; Natura & Co.; Coty Inc. - These are large, well-known, multinational manufacturers and marketers of skin care, makeup, fragrance, and hair care products, most of which market and sell their products under multiple brand names .
    • Independent brands, some backed by private-equity investors - These brands also compete in the beauty market .
    • Retailers with their own beauty brands - Some retailers that are customers of Estée Lauder also market and sell competing brands .
    CustomerRelationshipSegmentDetails
    Largest Customer (China travel retail)
    Primarily sells Estée Lauder products through the China travel retail channel
    Travel Retail (China)
    $206 million (12% of accounts receivable) as of June 30, 2024; previously $49 million (3%) as of June 30, 2023.
    NameStart DateEnd DateReason for Change
    PricewaterhouseCoopers LLP (PwC)Fiscal Year Ending June 30, 2021 PresentCurrent auditor.
    KPMG LLP2002 Fiscal Year Ended June 30, 2020 Dismissed after a competitive process by the Audit Committee.

    Recent developments and announcements about EL.

    Corporate Leadership

      Board Change

      ·
      Jan 10, 2025, 1:26 PM

      Key Update: On January 10, 2025, Ronald S. Lauder retired from the Board of Directors of The Estée Lauder Companies Inc. after serving since 2016. He was succeeded by Eric Zinterhofer, who has been elected as a Class II director. Mr. Zinterhofer is a Founding Partner of Searchlight Capital Partners and has extensive experience in private equity and corporate boards.

      Leadership Change

      ·
      Jan 10, 2025, 1:25 PM

      Ronald S. Lauder is retiring from the Board of Directors of The Estée Lauder Companies Inc., effective January 10, 2025. His decision to retire is not due to any disagreements with the company. He will continue as Chairman of Clinique Laboratories LLC. Eric Zinterhofer has been elected as a Class II director to replace Mr. Lauder. Mr. Zinterhofer is a Founding Partner of Searchlight Capital Partners and has extensive experience in private equity.

      Board Change

      ·
      Dec 4, 2024, 10:10 PM

      Richard D. Parsons has retired from the Board of Directors of The Estée Lauder Companies Inc. due to health reasons, effective immediately as of December 3, 2024. He was a Class II director and a member of the Nominating and ESG Committee and the Compensation Committee .

      Leadership Change

      ·
      Dec 4, 2024, 10:10 PM

      Richard D. Parsons is leaving the Board of Directors of The Estée Lauder Companies Inc. due to health reasons, effective immediately. He has been a Board member since 1999 and was part of the Nominating and ESG Committee and the Compensation Committee .

      Board Change

      ·
      Nov 1, 2024, 12:00 AM

      Stéphane de La Faverie has been appointed as President and Chief Executive Officer of The Estée Lauder Companies Inc., effective January 1, 2025. He will also join the Board of Directors on the same date. Fabrizio Freda will resign from the Board at the end of the day on December 31, 2024. Additionally, William P. Lauder will step down from his role as Executive Chairman following the Annual Meeting of Stockholders on November 8, 2024, but will continue to serve on the Board as Chair .

      CEO Change

      ·
      Nov 1, 2024, 12:00 AM

      Fabrizio Freda, the current President and CEO of The Estée Lauder Companies Inc., will be stepping down from his role and resigning from the company's board at the end of December 31, 2024. Stéphane de La Faverie has been appointed to succeed him as President and CEO, effective January 1, 2025 .