Shares of Elizabeth Arden were down as much as 24% on Tuesday, and the culprit is a familiar pop culture figure: Justin Bieber.
In the fourth quarter, Elizabeth Arden’s sales fell 28.4% from last year to $US191.7 million.
Expectations were for revenue to come in at $US241.64 million, which would have been a decline of just less than 10%.
Arden said sales were weaker than expected because of a steeper than anticipated decline in the sale of its Justin Bieber and Taylor Swift fragrances.
In its earnings press release, the Elizabeth Arden said: “While the Company had expected weaker sales comparisons due to the lower level of fragrance launch activity in fiscal 2014 versus fiscal 2013, the decline in sales of celebrity fragrances, particularly the Justin Bieber and Taylor Swift fragrances, was steeper than anticipated. The inventory destocking at a number of non-prestige customers that impacted the Company’s 2014 third fiscal quarter results continued through the fourth quarter of fiscal 2014 and led the Company’s shipments to be below the rate of retail sales.”
For its fiscal year 2014, sales fell 13.4% to $US1.164 billion, more than the roughly 10% decline that was expected by analysts. And excluding the pre-market decline in shares of Arden on Tuesday, the stock was down more than 44% year-to-date as of the close on Monday afternoon.
Arden said that fiscal 2014 would be “focused on stabilizing the business and will be the first year of a multiyear plan to rebuild profitability.”
The company said, however, that in the first quarter it would still be “challenged by the same factors that affected recent quarters.”
So Bieber isn’t going anywhere.
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