UPDATE: Estee Lauder Profit Plunges 70% As Sales Drop

By Andria Cheng

NEW YORK (Dow Jones) -- Beauty giant Estee Lauder Cos. said Monday that its fiscal third-quarter profit plunged 70%, hurt by a stronger dollar and declining demand in the Americas and European regions.

Profit dropped to $27.2 million, or 14 cents a share, from $90.1 million, or 46 cents, a year earlier. Sales in the quarter ended March 31 declined 9.8% to $1.7 billion. They would have fallen 2% minus the impact of currency translations.

Excluding restructuring charges, the company said it would have earned 16 cents a share. Analysts, on average, estimated Estee Lauder to earn 5 cents a share, according to FactSet.

The company forecast per-share profit excluding non-recurring items to be between $1.32 to $1.44 a share for the year with sales declining as much as 3% excluding the impact of currency translations.

Wall Street analysts expected an average profit of $1.36 a share, according to FactSet.

Estee Lauder (EL) shares rose 6% to $32.99 in pre-market trading.

Estee Lauder has been hurt by the economic downturn that has cut into consumer demand and led its department store customers to lower inventory. Shoppers also have traded down to cheaper drug store cosmetics and skincare products, analysts have said. Like other companies, Estee Lauder has pared costs and said it's seeking additional opportunities to be more efficient.

Sales in the Americas dropped 8.7% to $804.4 million. In Europe, they tumbled 17% to $583.5 million. In Asia, they rose 3.8% to $308.6 million.

By product categories, skin care sales fell 6.3% to $709 million. Make up sales declined 8.1% to $694.5 million. Fragrance sales tumbled 28% to $187.7 million. Hair care sales dropped 7.7% to $90.6 million.