EssilorLuxottica books 1.9b euros profit, virus hurts Greater China business

EssilorLuxottica SA said today that revenue grew in 2019, and it raised the dividend as it guided for sales growth in 2020 despite the coronavirus epidemic.

The Franco-Italian optical giant reported net profit of 1.08 billion euros, flat compared with a restated figure of 1.08 billion euros the year before, MarketWatch reports. Net profit adjusted for the Essilor-Luxottica merger and other one-offs grew by 9.2 percent to 1.94 billion euros, the company said.

The company--which was created in October 2018 from the combination of optical-lens manufacturer Essilor and luxury-eyewear maker Luxottica--said revenue was 17.39 billion euros, up from a pro forma figure of 16.19 billion euros in 2018 and broadly in line with analysts' expectations of 17.36 billion euros, according to a consensus estimate provided by FactSet.

At constant currencies, revenue was up by 4.4 percent, EssilorLuxottica said.

The company's lenses and optical instruments category increased revenue by 5.5 percent at constant exchange rates, whereas sunglasses and readers were up by 8.9 percent at constant exchange rates.

"The current Covid-19 epidemic has a negative impact on the company's business in Greater China, which represents about 5 percent of consolidated revenue," EssilorLuxottica said, adding that its revenue in other regions has also been slightly hit by the virus.

EssilorLuxottica issued its guidance for 2020 based on the assumption that the epidemic will subside in the next few months.

It guided for sales growth of 3 percent-5 percent at constant exchange rates, and said it sees operating profit for the period, adjusted for the expenses from the Essilor-Luxottica merger and other special items, growing at 0.7 times to 1.2 times the pace of sales growth. Adjusted net profit, adjusted for the same factors, should also grow at 0.7 times to 1.2 times the pace of sales growth, EssilorLuxottica said.

The eyewear company declared a dividend of 2.23 euros a share, compared with 2.04 euros a share for 2018.