Ulta Beauty on Thursday raised the lower end of its full-year profit and sales forecasts helped by buoyant demand for luxury skincare and fragrances and also said its longtime CFO Scott Settersten will retire in April next year.

Settersten who has been with the company for nearly 20 years will be succeeded by Paula Oyibo, the company’s senior vice president of finance who joined in 2019.

Shares of the beauty retailer rose 6.6 percent in extended trading after the company also beat third-quarter results.

Despite rising borrowing costs leading to tightened household budgets, wealthy shoppers have prioritised indulging in beauty and skincare goods even as they cut back on bigger discretionary purchases like televisions and apparel.

Ulta has also seen a boost from consumer interest steering toward dermatologist recommended brands like La Roche-Posay and CeraVe while also seeing robust demand from social media promotions of brands like Good Molecules, Hero Cosmetics and Peach Slices.

The third quarter saw a slew of new launches notably – ‘Half Magic’, a vegan and cruelty-free makeup line by Euphoria makeup artist Donni Davy exclusive to Ulta Beauty, hair styling tools from Shark Beauty, dermatologist recommended PanOxyl, a popular Gen Z brand and Sniff, an emerging unisex fragrance.

The cosmetics retailer raised the lower end of its annual profit forecast to $25.20 and $25.60 per share, from its previous view of $25.10 to $25.60 per share.

The company also raised the lower end of its annual net sales forecast. It now expects it between $11.10 billion and $11.15 billion, versus its prior forecast of $11.05 billion to $11.15 billion.

The retailer’s quarterly net sales rose 6.4 percent to $2.49 billion. Analysts on average expected revenue of $2.47 billion, as per LSEG data.

Excluding items, the company earned $5.07 per share topping Wall Street’s expectations of a profit of $4.95.

By Annett Mary Manoj

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