EssilorLuxottica Upbeat on Mid-Term Targets Despite Slowing Growth

By Joshua Kirby

EssilorLuxottica's revenue growth slowed in the third quarter amid sluggish sales of sunglasses, but the company backed its longer-term financial targets.

The Franco-Italian eyewear giant made total revenue of 6.29 billion euros ($6.63 billion) in the July-September period, 5.2% higher than in the same period last year, adjusted for currency effects. This was in line with analysts' expectations, according to a poll of estimates compiled by FactSet, but slightly slower than in the first half of the year.

Revenue grew most slowly in the group's largest market, North America, where sales of sunglasses continue to drag overall performance. Sales at retailer Sunglass Hut remained lower on year in the region over the quarter, EssilorLuxottica said.

Weakness in sunglass retail also hit the Europe, Middle East and Africa region, the company said, pointing to unfavorable weather in July and August. In Asia-Pacific, however, revenue rose by double digits, despite a tough comparison base after a strong quarter last year.

Looking ahead, the Ray-Ban maker said it remains confident of netting annual revenue growth in the mid-single digits between 2022 and 2026, as well as reaching an adjusted operating margin of 19%-20%.

"We are doubling down on our strengths," said Francesco Milleri and Paul du Saillant, EssilorLuxottica's chief executive and deputy CEO, respectively, in a joint statement. They pointed to a new joint frame-and-lens factory in Thailand as an example of the group's growing global footprint.

Write to Joshua Kirby at [e-mail]; @joshualeokirby

(END) Dow Jones Newswires

October 19, 2023 12:46 ET (16:46 GMT)

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