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EssilorLuxottica : second quarter and first half 2021 results

07/30/2021 | 01:09am EDT

EssilorLuxottica's second quarter and first half 2021 results

Revenue acceleration, margin expansion and record cash flow

Outlook 2021 improved

Second quarter:

  • Revenue +9.2% versus 2019 at constant exchange rates1
  • North America best performing region, EMEA and Latin America positive
  • Professional Solutions and Direct to Consumer both growing and accelerating
  • Optical and sun both growing, with sun catching up in pace
  • E-commerce+66% versus 2019 at constant exchange rates1, reaching 9% of total revenue

First half:

  • Operating profit +35% versus 2019 at constant exchange rates1
  • Adjusted2 operating profit margin at 18.5%, up 130 basis points versus 2019
  • Free cash flow4 record generation at Euro 1.2 billion

Charenton-le-Pont, France (30 July 2021, 7:00 am) - The Board of Directors of EssilorLuxottica met on 29 July 2021 to approve the condensed consolidated interim financial statements for the six months ended 30 June 2021. The Statutory Auditors have performed a limited review of these financial statements. Their report is in the process of being issued.

"We delivered another strong set of results in the first half, despite the ongoing challenges of the pandemic. Our continued focus on premium products and brands, a powerful supply chain and a global community of talented and engaged employees helped us get there.

In the second quarter, we wrote some important pages in EssilorLuxottica's history by clarifying our governance and building one unified company, while continuing to expand our retail footprint in Europe by completing the acquisition of GrandVision.

Looking to the future, we're proud to share our new company-wide Sustainability approach, "Eyes on the Planet", built around key pillars including carbon, circularity, world sight, inclusion and ethics. As a sign of our long-term commitment in this area, today we announce our target to achieve carbon neutrality across our direct operations by 2025, starting in Europe by 2023. Doing good for our customers, consumers and communities, and doing good for our planet gives us even greater confidence about what lies ahead", said Francesco Milleri, CEO of EssilorLuxottica and Paul du Saillant, Deputy CEO of EssilorLuxottica.


Operational & Financial highlights

Highlights and comments for the second quarter and the first half of 2021 are provided versus the same periods of 2019. The comparison with the performance of 2020 is presented in the Management Report.

€ millions

H1 2021

H1 2019*

Change at








Adjusted2 Gross Profit




% of revenue



Operating Profit




Adjusted2 Operating Profit




% of revenue



Group Net profit




Group Adjusted2 Net Profit




% of revenue



  • Some reclassifications between cost of sales and operating expenses have been realized to ensure consistency with the current period presentation. Those reclassifications do not affect the operating profit presented for the six-month period ended on 30 June 2019.

In the second quarter of the year, the economic environment evolved reflecting the COVID-19 situation in the different regions of the world. On the recovery path, North America moved first and faster, EMEA followed more gradually and Latin America later in the quarter, while Asia-Pacific was affected by new virus outbreaks and consequent restrictions. The Company leveraged the market recovery and its leading multicategory and multichannel proposition to sharply accelerate in revenue and margins, with a sound performance in the whole first half of the year.

In the second quarter, total revenue amounted to Euro 4,709 million, up 9.2% versus the second quarter of 2019 at constant exchange rates1. North America advanced by 16.4%, EMEA by 3.8% and Latin America by 2.0%, while Asia-Pacific declined by 3.5%.

On top of a buoyant US, generating more than 50% of the Group's revenue, other key markets were nicely growing and fuelling the Company's business acceleration, namely France, Italy, UK, Mainland China, Australia and Brazil.

Based on the new segment reporting, the two channel-based divisions of Professional Solutions (wholesale) and Direct to Consumer (physical retail and e-commerce) both accelerated in the quarter, growing by 5.0% and 15.7% respectively at constant exchange rates1, representing 58% and 42% of total revenue.

Optical and sun categories both progressed, broadly aligned in terms of growth pace compared to the second quarter of 2019. Optical continued to grow, representing two thirds of the Group's business, on the back of the Company's ability to constantly deploy innovation in lenses (e.g. Stellest in China) and


instruments. Sunglasses nicely bounced back across all the channels in Professional Solutions and Direct to Consumer, catching up with the pace of optical, boosted in particular by luxury brands.

Brands prove to matter, with blockbusters value-added lenses (in particular Crizal, Transitions and Eyezen) driving the growth in optical and frame brands (in particular Oakley and licenses like Prada, Dolce & Gabbana and Versace, especially in North America) being a winning factor in both optical and sun.

E-commerce progressed by 66% in the quarter at constant exchange rates1, reaching 9% of the Group total revenue, with broadly the same performance throughout the semester. Main platforms Ray- Ban.com, Oakley.com, SunglassHut.com and EyeBuyDirect.com all contributed, with North America as the top performing area.

Revenue growth translated into a material increase in margins, thanks to the operating leverage which typically characterizes the Company's vertically-integrated business model, as well as the extraordinary cost containment measures put in place during COVID-19, which are set to be gradually removed as the business recovers.

In the first half of the year, the adjusted2 operating profit reached Euro 1,622 million, with the margin on revenue reaching 18.5%, posting 16.4% increase at constant exchange rates1 compared to the same period of 2019. Group adjusted2 net profit amounted to Euro 1,117 million, at 12.7% of revenue.

Free cash flow4 was Euro 1,211 million in the first six months of the year. Net debt5 stood at Euro 1,945 million at the end of the period, almost entirely represented by lease liabilities, as financial debt and cash and equivalents broadly matched.

The closing of the GrandVision acquisition announced on 1 July marked the completion of a visionary project, that is the combination of the three global champions of the industry into one single stronger Group, with the goal of elevating the eyecare and eyewear standards and growing awareness and access to quality vision care for all consumers.

As reiterated on 27 July, in the context of the update on the mandatory public tender offer, Essilorluxottica is able to fund the offer through readily available cash resources, including existing committed credit lines that are available for general corporate purposes.


EssilorLuxottica now expects its full year 2021 revenue to grow around mid-single digit versus 2019 at constant exchange rates1, with the adjusted2 operating profit as a percentage of revenue at constant exchange rates1 higher than 2019. This assumes that no further COVID-19 related restrictions will be introduced in the second half of the year.

Such targets refer to the EssilorLuxottica perimeter, excluding GrandVision which will be consolidated from 1 July 2021.

The new full year outlook represents an upgrade of the targets issued with the first quarter results, which pointed to revenue and adjusted2 operating profit margin at least at the level of 2019 at constant exchange rates1.


Integration & Synergies

The Group is on track to deliver its previously disclosed targets of cumulative synergies of Euro 300 to 350 million in adjusted2 operating profit by the end of 2021 and Euro 420 to 600 million by the end of 2023, despite the headwinds and the challenges due to the COVID-19 outbreak. The second quarter of 2021 registered a further acceleration in the integration process between the two operating companies, in particular with respect to successful commercial initiatives and efficiency activities in several functional areas.

Regarding revenue synergies, important contributors were the joint commercial initiatives in EMEA and North America with a strong focus on key accounts, the solid growth of EyeMed leveraging on North America's retail network, independent ECPs and other managed vision care partners, the successful offers for independent ECPs with dedicated services. The consolidation of the Group's retail network in Latin America is delivering good results as well.

With regards to cost synergies, they mostly came from the indirect procurement savings, the progress in building up a unified lab network and the creation of a common e-commerce fulfilment platform, progressively serving all the Company's online activities.

Enablers to the overall integration progress and synergies generation include R&D's pursuit of more innovative and sustainable products, the fruitful ongoing implementation of a unified SAP platform across different geographies and the creation of one technical platform for manufacturing machineries.

Mission & Sustainability: Eyes on the Planet

With a deep-rooted sense of responsibility, EssilorLuxottica continued to champion activities in support of its Mission to help people see more, be more and live life to its fullest. In the first half of 2021, the Company created access to sustainable vision care for over 20 million people by training over 650 community based primary vision care entrepreneurs and establishing four new OneSight vision centers. Since 2013, the Company has created access for nearly 450 million people in underserved communities, trained over 18,000 primary vision care entrepreneurs and created over 42 million new wearers for the industry, over 3 million of them in the first semester this year alone.

EssilorLuxottica welcomed the news announced on 23 July that all 193 member states of the United Nations unanimously passed a resolution committing to making eyecare accessible for the billions of people living with preventable vision impairment by 2030. The inclusion of eyecare in the Sustainable Development Goals supports EssilorLuxottica's own ambition to eliminate uncorrected poor vision in a generation. In September 2019, at the sidelines of the UN General Assembly, the Company had launched the roadmap, with the support of over 20 NGO and government partners, on how poor vision can be eliminated and now looks forward to working with national governments to make this a reality.

Drawing on Essilor and Luxottica's long history of corporate responsibility, the Company is developing an integrated, ambitious and far-sighted approach that will reaffirm its position as a leader committed to sustainability. EssilorLuxottica's approach, titled Eyes on the Planet, is outlined in the new sustainability section on the Company's website. It will be built around the following pillars:

  • Eyes on Carbon: EssilorLuxottica is working toward achieving carbon neutrality across its direct operations (scope 1 & 2 emissions) by 2025, starting in Europe by 2023. The Company's investments in renewable electricity, such as solar and biomass heating systems and


photovoltaic installations, have enabled it to significantly reduce its reliance on fossil fuels and consequently reduce greenhouse gas emissions. A major forest restoration project of 30 hectares in the foothills of the Dolomites (UNESCO World Heritage Site) near Luxottica's main production plant in Agordo, Italy, is a shining example of the Company's efforts to protect and restore natural ecosystems.

  • Eyes on Circularity: EssilorLuxottica is making bold moves across the entire production cycle, including a shift from fossil-based materials to bio-based materials, which produce fewer emissions, biodegrade, and are easier to recycle. This is reflected in the recent investment in Mazzucchelli to develop and produce a highly sustainable type of acetate as well as Arnette and Costa's new sustainable collections.
  • Eyes on World Sight: Based on EssilorLuxottica's belief that good vision is a basic human right, the Company is on a mission to eliminate uncorrected poor vision by 2050 and making vision care accessible to everyone, everywhere. From providing vision care to millions in need through community based sustainable models to partnering with the world's most impactful philanthropies, EssilorLuxottica is tireless in realizing its vision for universal access. With the Vision Catalyst Fund, the Company has pledged to donate 200 million pairs of lenses by 2030.
  • Eyes on Inclusion: In 2020, EssilorLuxottica earned a spot on the Financial Times "Diversity Leaders" list, highlighting its efforts to create a community of inclusiveness regardless of geography. In the past year alone, the Company launched a global learning initiative focused on unconscious bias, a US Think Tank steered by employees from various backgrounds and levels, and introduced several employee led Business Resource Groups (BRGs) to bring people together through common interests.
  • Eyes on Ethics: EssilorLuxottica takes an ethical approach to doing business that not only positively impacts its employees, but also has a tangible impact on the millions of customers and consumers it serves around the planet. The Company's vertically-integrated business model, built over decades, is the key to delivering that ethical approach wherever it has a presence.

New employee representatives appointed to the Board

Two new board members, Ms Margot Bard and Mr Sébastien Brown, both employees of Essilor International in France, were chosen by the Group's Works Council to represent the employees at the Company's Board. Their appointment will become effective on 22 September 2021 for a period of three years.


This is an excerpt of the original content. To continue reading it, access the original document here.


EssilorLuxottica SA published this content on 30 July 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 July 2021 05:08:05 UTC.

© Publicnow 2021
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Analyst Recommendations on ESSILORLUXOTTICA
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Sales 2021 19 823 M 23 241 M 23 241 M
Net income 2021 1 915 M 2 245 M 2 245 M
Net Debt 2021 7 850 M 9 203 M 9 203 M
P/E ratio 2021 38,5x
Yield 2021 1,43%
Capitalization 75 029 M 88 073 M 87 964 M
EV / Sales 2021 4,18x
EV / Sales 2022 3,62x
Nbr of Employees 144 888
Free-Float 63,6%
Duration : Period :
EssilorLuxottica Technical Analysis Chart | EL | FR0000121667 | MarketScreener
Technical analysis trends ESSILORLUXOTTICA
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Income Statement Evolution
Mean consensus OUTPERFORM
Number of Analysts 21
Last Close Price 170,30 €
Average target price 171,80 €
Spread / Average Target 0,88%
EPS Revisions
Managers and Directors
Francesco Milleri Chief Executive Officer & Non-Independent Director
Stefano Grassi Co-Chief Financial Officer
David Wielemans Co-Chief Financial Officer
Leonardo del Vecchio Executive Chairman
Jean Carrier-Guillomet Co-Chief Operating Officer
Sector and Competitors