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Coty Delivers Strong 1Q22 Results , Well Ahead of Expectations Prestige Launches Drive Sales Momentum and Consumer Beauty Back to Growth Strong Gross Margin Expansion and Cost Control Fuel Reinvestment And Progress on Each Strategic Pillar FY22 Sales Growth Outlook Raised to Low to Mid Teens Growth at Current FX Levels November 18th Investor Day to Detail Strategic Progress and Medium Term Trajectory NEW YORK - November 8 , 2021-- Coty Inc. ( NYSE : COTY ) ( " Coty " or " the Company " ) today announced another quarter of improvement in its financial results and further progress across each of its strategic growth pillars for the first quarter of fiscal year 2022 , ended September 30 , 2021 . In Q1 , revenues increased 22 % , or 20.6 % LFL , surpassing guidance of high - teens LFL growth , with a combination of strong brick & mortar growth and 23 % growth in e - commerce . Coty's Prestige business delivered superior 35 % reported and 34 % LFL growth in the quarter , despite a low single digit negative impact from the continued reduction of sales in low quality channels . Prestige fragrance sales increased strongly across nearly all brands , with particularly strong performance from Gucci , Burberry , Hugo Boss , Marc Jacobs , Calvin Klein , and Chloe . This momentum was fueled by a very strong fragrance launch calendar in Q1 with particular standout results from Gucci Flora Gorgeous Gardenia and Burberry Hero . At the same time , Prestige cosmetics sales more than doubled year on - year , led by Gucci makeup and the relaunch of Kylie Cosmetics . Regionally , the U.S. and China continued to deliver very robust performance , Travel Retail more than doubled led in particular by Asia and Europe , while trends in many Western European markets continued to improve . During the quarter , Consumer Beauty revenues increased 4 % as reported and 3 % LFL , as the global mass beauty category returned to growth and Coty continued to make progress towards share stabilization . CoverGirl generated double digit percent sell - in and sell - out growth , growing market share in 4 of the last 7 months , with outsized momentum in the Magnificent 8 franchises . Meanwhile , the re - positioning of both Rimmel and Max Factor , which kicked off in the summer , have also been showing solid progress across key European markets . Rimmel's Wonder ' Extension mascara has become its most successful mascara launch in the critical UK and German markets , with momentum building exiting Q1 with the launch of Rimmel's first - to - mass Kind & Free range of clean , vegan and cruelty free cosmetics products . At the same time , Max Factor's launch of its Facefinity foundation with Priyanka Chopra Jonas as spokesperson have propelled Max Factor to market share gains in the UK for the first time in years . The strong topline growth was matched by very robust profitability growth in Q1 , supported by both significant gross margin expansion and additional cost reductions , enabling a significant step - up in marketing spend , with working media doubling year - on - year . Reported gross margins expanded 460 bps in the quarter to 63.2 % , while adjusted gross margin was up 480 bps to 63.4 % , above pre - pandemic levels , driven by a combination of product and channel mix , improved excess & obsolescence , pricing and mix benefits , and higher production volumes . This substantial expansion fueled reinvestment behind key strategic initiatives . In addition , Coty continued to lower its cost base , with year - over - year savings of approximately $ 60 million , showing significant progress towards the FY22 savings target of over $ 90 million . The Company has now cumulatively achieved close to $ 400M of cost savings versus the FY20 baseline , and remains on track to achieve approximately $ 600M of savings by FY23 . The gross margin improvement and cost reductions allowed Coty to continue to reinvest behind its brands and highest ROI opportunities , as working media more than doubled versus last year , and total A & CP remained consistent sequentially at ~ 26 % of sales . At the same time , Coty delivered 1Q22 reported operating income of $ 17.2 million and adjusted EBITDA of $ 278.5 million , increasing 67 % from last year and resulting in an adjusted EBITDA margin of 20.3 % or 550 bps improvement versus 1Q21 . Financial Net Debt improved by approximately $ 200 million to just under $ 5 billion at the end of 1Q . Free cash flow was strong in a seasonally weaker quarter at $ 240.7 million . With an increase in the value of Coty's 40 % Wella stake at quarter end to approximately $ 1.65 billion at quarter - end , the Company's Economic Net Debt totaled approximately $ 3.3 billion . Commenting on the operating results , Sue Y. Nabi , Coty's CEO , said : 1