Half Year 2024 EssilorLuxottica SA Earnings Call Transcript
Key Points
- Essilorluxottica (ESLOF) posted revenue growth in line with long-term targets, with both quarters well aligned in performance.
- The company has made significant progress in developing new technology, including AI-based face computing and wearable tech.
- Essilorluxottica (ESLOF) announced two strategic acquisitions: Heidelberg Engineering and the Supreme brand, which are expected to enhance capabilities and market reach.
- The company reported a strong gross margin expansion of 40 basis points, driven by a favorable price mix and product innovation.
- Essilorluxottica (ESLOF) generated EUR971 million in free cash flow, maintaining a strong balance sheet with a net debt to EBITDA ratio of 1.5.
- The U.S. market showed a low single-digit growth, with some segments experiencing deceleration, particularly in the independent channel.
- Sunglass Hut locations in North America reported low single-digit negative comps, indicating a soft demand in the region.
- The company faces inflationary headwinds, particularly in labor costs, which continue to impact profitability.
- Essilorluxottica (ESLOF) experienced challenges in the Latin American market, particularly in Brazil, due to severe flooding affecting operations.
- The launch of new products like Nuance audio is still pending FDA approval, which could delay market entry and revenue generation.
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Hello, everybody. This is Rogério Nahla from the IR team. Thank you for joining EssilorLuxottica H1 2024 results management call the Group's Chairman and CEO, Francesco me, Larry, the Deputy CEO, Paul to say, Jan and the CFO, Stefano Grassi, will walk you through the business and financial highlights for the period. After their presentations, there will be a Q&A session. If you want to make a question, please press star followed by five. We kindly ask you to limit your questions to a maximum of two.
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With that, I hand it over to Francesco, welcome, everybody, and good to see so many of you connected today for the Essilor Luxottica first semester Earnings Call. I'm pleased to introduce our sound financial performance and give you an update on our key strategic initiatives. In the first six months of the year, we posted revenue growth in line with the long-term targets with the two quarter well
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