Coty Sells Lacoste Fragrance License Back to Lacoste
It’s a case of one out, one in for Coty’s fragrance offering.
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Coty has sold its Lacoste fragrance license back to Lacoste by mutual agreement for an undisclosed sum, and separately, renewed its license with Hugo Boss.
Coty had managed Lacoste’s fragrances for the past six years and stressed that during its tenure, Lacoste men’s fragrances have secured a premium positioning in the market, with two award-winning pillars, L’Homme and Match Point, multiple innovations, and a 17-place improvement in French market rankings.
Thierry Guibert, Lacoste president, said: “We are very appreciative of Coty’s support throughout our partnership. With Coty, Lacoste has taken an important step in the development of its fragrance lines. It is now time for the brand to renew its approach to continue its growth, in a market where Lacoste still has great potential.”
Sue Y. Nabi, Coty’s CEO, added: “For both Coty and Lacoste, the exit by end of CY23 represents our respective yet mutually beneficial priorities. This sale advances Coty’s strategic objectives, by enabling Coty to further focus on our largest fragrance licenses, while accelerating our deleveraging agenda through the sales proceeds.”
WWD understands Lacoste has a big footprint in Russia, an area which Coty has divested from due to its invasion of Ukraine.
At the same time, Coty has renewed its license with Hugo Boss. The partnership, which began in 2016 and has now been extended beyond 2035, includes all Boss and Hugo fragrances for men and women.
Nabi said the extension “is in line with Coty’s strategic objective to focus on key brands which can become global powerhouses, while driving a balanced growth agenda across our fragrance portfolio.”
Following the Hugo Boss license renewal, which includes no material changes in licensing terms, Coty has no sizable license up for renewal in the next six years. The average remaining duration of Coty’s top six licenses — which together account for more than 80 percent of Coty’s prestige fragrance business — is now approximately 10 years.
Earlier this year, Nabi told WWD that while the lipstick effect is mentioned often, she believes it’s now all about the fragrance effect, with Coty’s prestige fragrances having been flying off the shelves despite recession fears and sky-high inflation.
More recently, Coty’s net revenues came in at about $1.4 billion in the first quarter ended Sept. 30. This was up 1 percent from a year earlier and a touch above analysts’ forecasts of $1.37 billion, according to a Factset poll.
