Puig Eyes U.S. Tariffs as Group’s FY 2024 Profits Rise 14.1%

PARIS – Puig profits rose 14.1 percent in 2024, its first year as a listed company, and expects to outperform the premium beauty market.

The Spanish beauty and fashion company is also keeping an eye on possible U.S. tariffs on goods imported from Europe.

The owner of the Rabanne, Carolina Herrera and Jean Paul Gaultier brands said Thursday it expects organic sales growth in 2025 to be between 6 percent and 8 percent. Last year sales increased 10.9 percent.

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Puig had priced tariffs into its sales projection, but not at the 25 percent level U.S. President Donald Trump threatened on Wednesday, the day before the company published its full-year 2024 profits, after the market close.

“With the strength of our brands and our healthy gross margins, we are able to cope with tariffs to some extent,” said Marc Puig, chairman and chief executive officer of Puig, speaking to financial analysts and journalists during a call Thursday evening.

“If this level of tariffs is finally implemented, we would need to reassess the potential impact to adjusted [earnings before interest, taxes, depreciation and amortization] margin for the year,” said Puig. “We continue to monitor this situation.”

Many question marks remain — whether the tariffs will be implemented and if so, which product categories they impact and when they’re put into effect.

“Then we will be able to assess if there is any impact on our business,” said Puig.

Other factors could undermine the upside of the guidance, such as the momentum of the fragrance business.

The year “2024 was another strong year for the fragrance market; even though we saw some moderation of growth during the holiday season, these levels remained healthy and are consistent with or hypotheses at IPO,” said Puig.

At that time, the company outlined growth of between 6 percent and 7 percent over the next few years. During 2024 the market grew faster than that, although the pace normalized to the estimate during the holiday season.

“We remain very confident in the prospect for fragrances in 2025,” he continued.

Another factor is prestige makeup’s momentum.

“We have seen mixed momentum in this category, some of which has been driven by the proliferation of dupes in the category,” said Puig. “We are responding to this through innovation, education and creativity, along with legal measures.”

Puig’s net profit reached 531 million euros, and adjusted operating cash flow was 825 million euros, an increase of 263 million euros year-on-year, benefiting from the increase in profitability and significant improvement in working capital.

As previously reported, Puig’s full-year sales were 4.79 billion euros, coming in ahead of the company’s medium-term guidance provided a year ago and outperforming the premium beauty market.

Puig continues to see upside potential for margin in the medium term, allowing for continuous reinvestment in company brands.

“We will continue to prioritize growth over margin improvement, and therefore we will maintain healthy levels of A&P investment,” said Puig.

The group aims to drive margin improvement in 2025 in line with 2024.

It plans to maintain a highly selective approach to mergers and acquisitions.

“We have always mentioned that we are going to be very careful, because we have what we believe is a curated portfolio,” said Puig. “If the right opportunity comes, then we will be proactive.”

But currently, the group is more focused on continuing the progressive integration of the brands it’s acquired recently.

During the call, Puig reviewed the past year.

“According to our estimates, we had three brands among the top 10 globally, with Jean Paul Gaultier joining Rabanne and Carolina Herrera for the first time,” said Puig. “This means two things: It shows our ability to achieve and maintain positions in top rankings, while also making it clear that there is opportunity to advance further in the rankings.”

Carolina Herrera Good Girl became the number-one women’s fragrance line worldwide, as well as the top-ranked feminine fragrance line in the U.S. last year.

As a result, Puig in 2024 strengthened its value market share globally in selective fragrances, achieving a record 11.5 percent, according to estimates.

Jean Paul Gaultier was Puig’s fastest-growing brand, and Le Male became the number-three masculine fragrance line worldwide. Rabanne’s 1 Million placed fourth among masculine fragrance franchises.

Puig’s fragrance and fashion division generated sales of 3.54 billion last year, up 13.6 percent in reported and constant-perimeter terms. Its makeup activities’ sales declined 1.3 percent on both a reported and organic basis.

“We are in the early days of building the makeup proposition for core fragrance- and fashion-led brands,” said Puig. “We are learning that it takes a long period of investment to build this, even with large and established brands.

“Puig operates by brand, and when we look at the P&L and the opportunities that build out of the makeup proposition and brings to brands like Rabanne and Carolina Herrera, it makes strategic sense,” he continued. “But it is challenging from a reporting standpoint, because these investments are then reflected in the makeup segment.”

Gaps in the sell-in and sell-out, as well as the impact of dupes and the withdrawal of a batch of the Charlotte Tilbury Airbrush Flawless Setting Spray slowed the growth for Puig in the makeup category.

In 2024, Puig’s skin care segment registered sales of 516.2 million euros, up 19.8 percent on a reported basis and 7.4 percent in organic terms.

“In particular, dermocosmetics continued to perform strongly, with Uriage delivering double-digit organic growth, supported by successful launches and hero franchise accelerations,” said Puig.

Concerning geographies, he said the company delivered strong growth in its core regions of Europe, Middle East and Africa, and the Americas.

“While APAC’s performance was more moderate, we delivered growth in this region, as well,” said Puig. “And we began to see the benefits of the implementation of newer subsidiaries in the region.”

The executive remains bullish on 2025.

“We feel confident that given the strength and desirability of our brands, we will be able to outperform the premium beauty market,” said Puig.