Croda, a significant supplier for cosmetics brands including Estee Lauder, has decreased its annual profit predictions due to declining demand, especially in its North American beauty care business.
Following the announcement, Croda’s shares dropped by 11.5%, reaching their lowest since April 2020 at 4,242 pence. The company now forecasts a 2023 pre-tax profit between 300 million and 320 million pounds, lower than the previously expected 370 million. The third-quarter sales in its beauty care division, particularly in North America, failed to meet expectations.
Globally, beauty product retailers have experienced reduced demand this year, with challenges in the duty-free, travel destinations, and, notably, the Chinese market. Inflation has led consumers to reduce spending on non-essential items. In response, Croda has initiated cost-cutting measures, such as plant shutdowns.
