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Estée Lauder shares plunge as China sales slump prompts dividend cut

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Estée Lauder shares plunge as China sales slump prompts dividend cut

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Estée Lauder, the beauty company that owns Clinique and MAC Cosmetics, has cut its dividend and ditched its profit forecast as a sales slump in China deepens, prompting a 25 per cent plunge in its shares as trading opened in New York.

The New York-listed beauty group, which is in the midst of a turnaround and leadership transition, said on Thursday that a recovery in Chinese demand had proved slower than expected, with sales in the country falling by a double-digit percentage in the three months to the end of September.

As a result of the difficulty in forecasting when the Chinese market will recover, Estée Lauder said it was withdrawing its outlook for the rest of the year and reducing its dividend to a “more appropriate” level.

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Fabrizio Freda, who will retire as chief executive in January after 16 years at the company, said Estée Lauder expected “still-strong declines” in demand in China as well as in tourist shopping in Asia in the near term, and “ongoing normalisation of growth in prestige beauty, most notably in North America”.

The beauty industry has taken a hit from the economic slowdown in China, which has been a major profit engine for Estée Lauder and its larger rival L’Oréal in recent years.

The dour outlook will be another challenge incoming chief executive Stéphane de La Faverie will have to contend with when he takes the reins at a time when the Lauder family that controls the beauty group is stepping back from day-to-day management.

The company is implementing a turnaround programme designed to cut costs and overheads while reinvesting in its brands and innovation. Freda said the reset had “delivered promising initial results”.

After underperforming peers during two years of falling sales and profits, Thursday’s outlook cut is another blow for a company whose shares are now down 55 per cent this year, reducing its market value to $23bn.

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L’Oréal, the world’s biggest beauty company, last week missed quarterly sales expectations and flagged ongoing weakness in China and in travel retail. Its shares are down 23 per cent this year.

Estée Lauder reported a 4 per cent year-on-year drop in sales to $3.36bn in the three months to the end of September. It expects the rate of decline to accelerate to 6 to 8 per cent in the current quarter.

All of Estée Lauder’s divisions had falling sales this quarter, with skincare — its biggest by sales — down 8 per cent on a like-for-like basis. Losses in make-up, its second biggest, deepened in the quarter compared with the same period a year ago.

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Top Drug Regulator Is Fired From the F.D.A.

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Top Drug Regulator Is Fired From the F.D.A.

Dr. Tracy Beth Hoeg, the Food and Drug Administration’s top drug regulator, said she was fired from the agency Friday after she declined to resign.

She said she did not know who had ordered her firing or why, nor whether Health Secretary Robert F. Kennedy Jr. knew of her fate. The Department of Health and Human Services did not immediately respond to a request for comment.

The departure reflected the upheaval at the F.D.A., days after the resignation of Dr. Marty Makary, the agency commissioner. Dr. Makary had become a lightning rod for critics of the agency’s decisions to reject applications for rare disease drugs and to delay a report meant to supply damaging evidence about the abortion drug mifepristone. He also spent months before his departure pushing back on the White House’s requests for him to approve more flavored vapes, the reason he ultimately cited for leaving.

Dr. Hoeg’s hiring had startled public health leaders who were familiar with her track record as a vaccine skeptic, and she played a leading role in some of the agency’s most divisive efforts during her tenure. She worked on a report that purportedly linked the deaths of children and young adults to Covid vaccines, a dossier the agency has not released publicly. She was also the co-author of a document describing Mr. Kennedy’s decision to pare the recommendations for 17 childhood vaccines down to 11.

But in an interview on Friday, Dr. Hoeg said she “stuck with the science.”

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“I am incredibly proud of the work we were doing,” Dr. Hoeg said, adding, “I’m glad that we didn’t give in to any pressures to approve drugs when it wasn’t appropriate.”

As the director of the agency’s Center for Drug Evaluation and Research, she was a political appointee in a role that had been previously occupied by career officials. An epidemiologist who was trained in the United States and Denmark, she worked on efforts to analyze drug safety and on a panel to discuss the use of serotonin reuptake inhibitors, the most widely prescribed class of antidepressants, during pregnancy. She also worked on efforts to reduce animal testing and was the agency’s liaison to an influential vaccine committee.

She made sure that her teams approved drugs only when the risk-benefit balance was favorable, she said.

The firing worsens the leadership vacuum at the F.D.A. and other agencies, with temporary leaders filling the role of commissioner, food chief and the head of the biologics center, which oversees vaccines and gene therapies. The roles of surgeon general and director of the Centers for Disease Control and Prevention are also unfilled.

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Supreme Court is death knell for Virginia’s Democratic-friendly congressional maps

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Supreme Court is death knell for Virginia’s Democratic-friendly congressional maps

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The U.S. Supreme Court refused Friday to allow Virginia to use a new congressional map that favored Democrats in all but one of the state’s U.S. House seats. The map was a key part of Democrats’ effort to counter the Republican redistricting wave set off by President Trump.

The new map was drawn by Democrats and approved by Virginia voters in an April referendum. But on May 8, the Supreme Court of Virginia in a 4-to-3 vote declared the referendum, and by extension the new map, null and void because lawmakers failed to follow the proper procedures to get the issue on the ballot, violating the state constitution.

Virginia Democrats and the state’s attorney general then appealed to the U.S. Supreme Court, seeking to put into effect the map approved by the voters, which yields four more likely Democratic congressional seats. In their emergency application, they argued the Virginia Supreme Court was “deeply mistaken” in its decision on “critical issues of federal law with profound practical importance to the Nation.” Further, they asserted the decision “overrode the will of the people” by ordering Virginia to “conduct its election with the congressional districts that the people rejected.”

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Republican legislators countered that it would be improper for the U.S. Supreme Court to wade into a purely state law controversy — especially since the Democrats had not raised any federal claims in the lower court.

Ultimately, the U.S. Supreme Court sided with Republicans without explanation leaving in place the state court ruling that voided the Democratic-friendly maps.

The court’s decision not to intervene was its latest in emergency requests for intervention on redistricting issues. In December, the high court OK’d Texas using a gerrymandered map that could help the GOP win five more seats in the U.S. House. In February, the court allowed California to use a voter-approved, Democratic-friendly map, adopted to offset Texas’s map. Then in March, the U.S. Supreme Court blocked the redrawing of a New York map expected to flip a Republican congressional district Democratic.

And perhaps most importantly, in April, the high court ruled that a Louisiana congressional map was a racial gerrymander and must be redrawn. That decision immediately set off a flurry of redistricting efforts, particularly in the South, where Republican legislators immediately began redrawing congressional maps to eliminate long established majority Black and Hispanic districts.

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Explosion at Lumber Mill in Searsmont, Maine, Draws Large Emergency Response

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Explosion at Lumber Mill in Searsmont, Maine, Draws Large Emergency Response

An explosion and fire drew a large emergency response on Friday to a lumber mill in the Midcoast region of Maine, officials said.

The State Police and fire marshal’s investigators responded to Robbins Lumber in Searsmont, about 72 miles northeast of Portland, said Shannon Moss, a spokeswoman for the Maine Department of Public Safety.

Mike Larrivee, the director of the Waldo County Regional Communications Center, said the number of victims was unknown, cautioning that “the information we’re getting from the scene is very vague.”

“We’ve sent every resource in the county to that area, plus surrounding counties,” he said.

Footage from the scene shared by WABI-TV showed flames burning through the roof of a large structure as heavy, dark smoke billowed skyward.

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The Associated Press reported that at least five people were injured, and that county officials were considering the incident a “mass casualty event.”

Catherine Robbins-Halsted, an owner and vice president at Robbins Lumber, told reporters at the scene that all of the company’s employees had been accounted for.

Gov. Janet T. Mills of Maine said on social media that she had been briefed on the situation and urged people to avoid the area.

“I ask Maine people to join me in keeping all those affected in their thoughts,” she said.

Representative Jared Golden, Democrat of Maine, said on social media that he was aware of the fire and explosion.

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“As my team and I seek out more information, I am praying for the safety and well-being of first responders and everyone else on-site,” he said.

This is a developing story. Check back for updates.

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