San Francisco, CA
415.489.5000
www.bareescentuals.com
Sales: $557 million

Sales:
$557 million. Net income: $98 million

There’s gold in mineral makeup…at least for shareholders of Bare Escentuals. One of the biggest news items of the year was the acquisition of Bare Escentuals by Shiseido for $1.7 billion through an all-cash tender offer and second-step merger. Bare Escentuals’ business will operate as a separate division of Shiseido and its brands will continue to be managed by the current leadership team. Still, as a Shiseido unit, this will be the last year that Bare Escentuals will be ranked in Happi’s Top 50.

For the fiscal year ended Jan. 3, 2010, company net sales and net income each increased 2%. A leader

New buffing brush from Bare Escentuals.

in the prestige category, Bare Escentuals products are sold in stores such as Ulta, Sephora, Nordstrom and Bloomingdale’s. Net sales from the company’s North America retail segment (including the U.S. and Canada) accounted for 62.1% of total net sales for the fiscal year ended Jan. 3, 2010.

The company’s North America direct to consumer segment (including infomercials, home shopping and online shopping, which accounted for 24.9% of total net sales) didn’t fare as well as the retail segment—sales fell 22%. International sales, which account for 13% of total net sales, rose 10%.

This year, Bare Escentuals also tapped the fragrance category with Leslie Blodgett Perfume Diaries, a limited-edition collection created exclusively for Sephora. Based on Blodgett’s global travels, there are currently three scents in the collection—Bare Skin, Santa Barbara and Golden Light.

“We believe this line can influence the fragrance market by looking at scents from a different perspective, a more personal perspective,” said Allison Slater, vice president of retail marketing for Sephora. “We believe that any woman who wants to revisit a pleasurable experience or happy memory garnered from a journey will gravitate to these scents.”

San Francisco, CA
415.489.5000
www.bareescentuals.com
Sales: $556 million

Sales: $556 million. Net income: $97.9 million.

Sales rose nearly 9% last year. By segment, North American retail accounted for 57.5% of sales. Products are sold in 795 North American premium wholesale locations, which include Ulta, Sephora, Nordstrom, Macy’s, Sephora in JCPenney, Bloomingdale’s and Shoppers Drug Mart in Canada. The division reported a 14.7% increase in sales, which the company attributed to the opening of 43 boutiques last year.

North American direct-to-consumer sales represented 30.6% of sales last year. Chief executive officer Leslie Blodgett is a frequent visitor to QVC, but Bare Escentuals’ products are also sold via infomercials. Last year, the division reported a 11.3% decline in sales to just over $170 million. The company blamed the decline on a drop in the performance of infomercials offset, in part, by an increase in online shopping sales.

International markets accounted for 11.9% of sales—up from 7.9% in 2007. International sales increased 64.3% to nearly $66 million. The company is building brand awareness through media channels such as infomercials and home shopping television in key international markets. Bare Escentuals partnered with a third party to build its infomercial business in Japan.

Last year, 71% of sales were derived from foundation products.

First quarter 2009 sales fell 11% to about $124 million. Net income fell 35% to $16.7 million.

“As anticipated, the economic environment remained challenging in the first quarter, manifesting in sharp inventory de-stocking among our key retail partners which impacted our first quarter financial results. In this environment, we are focused on managing our business as diligently and prudently as we can while continuing to improve upon the customer experience,” said Ms. Blodgett. “While expense management will remain top-of-mind at Bare Escentuals, we are equally committed to building on our strong brand heritage through strategic investments in new product introductions, customer acquisition and distribution expansion that will position us for long term success.”

San Francisco, CA
415.489.5000
www.barescentuals.com
Sales: $511 million

Sales:

$511 million. Net income: $88.1 million.

Nobody has to tell Leslie Blodgett that there’s gold in mineral makeup. The company is more than 30 years old, yet thanks to Ms. Blodgett’s energy, shows no signs of slowing down. Sales rose nearly 30% last year and net income was up 75%.

By retail channel, premium wholesale accounted for 32.1% of sales, followed by infomercials (24.7%), boutiques (16.8%), home shopping television (11.8%), spas and salons (11.1%) and international distributors (3.5%).

For the first quarter of 2008, sales rose 21% to $140.4 million.

“We are pleased with our strong start to 2008 which reflects a continuation of the positive brand momentum experienced in 2007,” said Ms. Blodgett. “We are on track to significantly expand our points of presence domestically and internationally, including our recent launch at Selfridges in London, our first department store in the United Kingdom. At the same time, we’re excited about our new business initiatives, including the growth of RareMinerals.”

In May, Cosmetic Executive Women named RareMinerals Blemish Therapy the 2008 winner in the facial and skin care category for acne treatment.

Last month, Bare Escentuals named Michael Dadario as president of retail. In this role, he will be responsible for Bare Escentuals’ overall retail strategy and execution including merchandising, sales and operations for all domestic brick-and-mortar distribution channels, including Bare Escentuals boutiques, premium wholesale locations, and spas and salons.