Yatsen Holdings, the Chinese beauty conglomerate that owns brands including Perfect Diary, Abby's Choice, Eve Lom, and Galénic, reported third quarter results and a $100 million share buyback over the next 24 months.

Third Quarter 2021 Highlights:

• Total net revenues for the third quarter of 2021 increased by 6.0% to RMB1.34 billion ($208.4 million) from RMB1.27 billion in the prior year period. The increase was primarily attributable to sales from newly launched and acquired brands.
• Gross margin for the third quarter of 2021 was 67.9% compared to 65.7% in the prior year period. The increase was primarily attributable to premiumization of the Perfect Diary brand, and increased sales from skincare brands with higher margins in the sales mix.
• Gross sales for the third quarter of 2021 increased by 8.3% to RMB1.56 billion ($241.9 million) from RMB1.44 billion in the prior year period. As a percentage of total net revenues, total operating expenses for the third quarter of 2021 were 95.4%, as compared with 116.6% in the prior year period.

“Despite a challenging macroeconomic backdrop and soft industry environment for color cosmetics, our topline continued to grow in the third quarter, supported by a significant growth of our skincare brands," stated Jinfeng Huang, founder, Chairman, and Chief Executive Officer of Yatsen. "Looking ahead, as we embark upon the next phase of our development, we expect to continue shifting our revenue mix towards higher-quality and more profitable growth, underpinned by sustained investments in our brand's brand equities and R&D. We are confident that despite some short-term pain, our strategic initiatives will allow us to emerge stronger with a clear path to long-term sustainable growth.”

“We managed to grow the business in the face of strong industry headwinds," commented Donghao Yang, Director and Chief Financial Officer of Yatsen. "Total net revenues reached RMB1.34 billion in the third quarter, representing an increase of 6.0% year over year. Our gross margin continued its upward trend and reached 67.9% in the quarter compared to 65.7% in the same period last year. With ample cash reserves and our sights set on charting a sustainable path to long-term growth, we will continue to build a world-class multi-brand beauty group in China.”

For the fourth quarter of 2021, the company expects its total net revenues to be between RMB1.57 billion and RMB1.67 billion, representing a year-over-year decline of approximately 15% to 20%, primarily due to the prior year period's high comparison basis and softer-than-expected industrywide color cosmetics sales.