Estee Lauder Discusses its Growth in China (EL 1Q06 Conf Call Quotes)

Skin care, makeup, fragrance, and hair care products company Estee Lauder (ticker: EL) is building a presence in China. The company hopes to capitalize on increasing disposable income and the Chinese inclination toward Western cosmetic products that are readily visible once applied. CFO Rick Kunes and President and CEO William Lauder had the following to say during management's Q1 2006 earnings results conference call:

In Asia-Pacific, sales this quarter grew 5% over the prior year quarter to $198.6 million. In local currency, sales this quarter were up 2%. Our business in China continued its momentum, once again generating high double-digit growth. The local currency increase also reflects double-digit growth in Hong Kong, and good growth in Taiwan.

In Asia-Pacific, we expect to see a continuation of exceptional growth in China, fueled by growth in prestige beauty, and expansion of our brands.

Asia-Pacific operating income decreased 3.5 million to 2.3 million, reflecting lower results in Hong Kong, Taiwan, Malaysia, and Thailand. China's results were also down, as we continued to investment in infrastructure in China to support future business opportunities. Solid improvement in Australia, and a modest increase in Japan, partially offset these results.

(Quotes are from the CCBN StreetEvents transcript.)

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