Question-and-Answer Session
Operator
(Operator Instructions) Our first question today comes from Chris Ferrarra with Merrill Lynch.
Christopher Ferrarra - Merrill Lynch
I just wanted to ask about -- I think you said that the Americas growth this quarter was helped by faster sell-in ahead of the holiday season. Is that right? Did I catch that right?
William P. Lauder
You did, and Chris, you recognize that we sell-in primarily at our first quarter for what the department stores are anticipating to sell at Christmas time, so effectively what has happened is that since this kind of rapid deterioration in the middle of September, we’re anticipating the second quarter, our sell-in to be obviously much, much lower because in all probability, in some respects, the stores have bought in more, anticipating a better Christmas than they now think is going to happen and we are seeing that ourselves in the second quarter and even in the third quarter, we’ll be somewhat lower.
Christopher Ferrarra - Merrill Lynch
Okay, so in other words, so you saw higher year-over-year sell-in related to holidays in this quarter but you expect it to reverse next quarter, is that right?
William P. Lauder
Effectively we saw Christmas go in, sell-in be relatively similar to what we saw last year, so anticipating a reasonably normal Christmas period. And then what’s happening is most recently, that Christmas period is deteriorating so we do not anticipate the stores would buy in to the level that they would normally do in the second quarter and even in the third quarter, and there might even be some returns, although what usually happens is it’s just the orders that come in in the second and third quarter are lower.
Christopher Ferrarra - Merrill Lynch
Okay, and then just a follow-up, I guess -- the 300 basis point reduction to your projected organic sales growth rate for 2009, can you sort of parse that out? How much of that is share category deceleration relative to what you thought before versus the mix of what you thought share gain might or might not have been?
Richard W. Kunes
I think I said in my remarks that we anticipated basically holding our share in North America, that we would gain share in Europe, although not to the extent that we were originally anticipating, and that we are certainly gaining share in Asia. So overall on a global basis, we are anticipating gaining market share but not to the extent that was originally built into our forecast.
- To read the full transcript on Seeking Alpha, click here »
