OAKLAND, Calif.--(BUSINESS WIRE)--e.l.f. Beauty (NYSE: ELF) today announced the acquisition of cruelty-free, clean beauty company W3LL PEOPLE for $27 million in cash. e.l.f. plans to leverage its marketing, customer relationships and operational capabilities to drive the W3LL PEOPLE brand. e.l.f. expects W3LL PEOPLE to contribute approximately $7 million in net sales and $0.01 to its adjusted earnings per share on a fully diluted basis in fiscal 2021.
“We are pleased to bring clean beauty pioneer W3LL PEOPLE under the e.l.f. Beauty umbrella as our first strategic extension. Clean beauty is a strategically important segment given consumer sentiment and strong growth rates. W3LL PEOPLE has a long history of expertise and credibility in clean beauty that works. Their brand values and market opportunity align closely with e.l.f. and we believe there are a number of synergies to be realized on both the cost and distribution fronts,” said Tarang Amin, e.l.f. Beauty Chairman and Chief Executive Officer.
W3LL PEOPLE was launched in 2008 by James Walker, Shirley Pinkson and Dr. Renee Snyder to provide high-quality, clean cosmetics. The company is cruelty-free, and its plant-based product-line – which contains no fillers, propylene glycol, petrochemicals or petroleum byproducts – includes forty EWG VERIFIED™ products, a leading standard of “clean and healthy” in the beauty space. W3LL PEOPLE has an emerging presence at leading national retailers including Target and Whole Foods; through natural specialty retailers such as Credo Beauty and The Detox Market; and online through Amazon.com, Ulta.com and W3LLPEOPLE.com.
“We have been transparent about our desire to pursue strategic extensions that can leverage our strengths and bring new capabilities to e.l.f., and we have been disciplined in this process,” said Tarang Amin. “W3LL PEOPLE is rooted in a deep and passionate understanding of clean beauty and shares our mission of making the best of beauty accessible. We believe that W3LL PEOPLE’s twelve years of clean beauty experience and high-quality product line, in combination with e.l.f.’s multiple strengths from operations to marketing, will be attractive to our retail partners – including Target, our longest-standing customer.”
“W3LL PEOPLE has a remarkable history of breaking beauty boundaries, and the acquisition by e.l.f. is an incredible milestone in our effort to make clean beauty accessible,” said James Walker, co-founder of W3LL PEOPLE. “We feel tremendously grateful for our brand’s success and the extraordinary team that helped build it.”
William Hood & Company, LLC served as exclusive financial advisor to W3LL PEOPLE in the transaction.
e.l.f. Beauty will hold a conference call today, February 24, 2020, at 5:00 p.m. ET to discuss the acquisition. The U.S. toll free dial-in for the conference call is (877) 407-3982 and the international dial-in number is (201) 493-6780. The conference call will also be webcast live at: http://investor.elfcosmetics.com/news-and-events/events and remain available for 7 days. A telephone replay of this call will be available at 7:30 p.m. ET on February 24, 2020, until 11:59 p.m. ET on March 2, 2020, and can be accessed by dialing the U.S. toll free dial-in, (844) 512-2921 or the international dial-in, (412) 317-6671, and entering replay pin number 13699232.
About e.l.f. Beauty
Since 2004, e.l.f. has made the best of beauty accessible to every eye, lip and face. We make high-quality, prestige-inspired cosmetics and skin care products at an extraordinary value and are proud to be 100% vegan and cruelty-free. As one of the first online beauty brands, e.l.f. has a passionate social following, national distribution at leading retailers such as Target, Walmart and Ulta Beauty, and a growing international presence. Learn more by visiting www.elfcosmetics.com.
This press release contains forward-looking statements within the meaning of the federal securities laws, including those statements relating to e.l.f. Beauty’s plans to leverage its marketing, customer relationships and operational capabilities to drive the W3LL PEOPLE brand, e.l.f. Beauty’s expectations regarding W3LL PEOPLE’s contributions to e.l.f. Beauty’s financial results, e.l.f. Beauty’s beliefs regarding synergies from the acquisition of W3LL PEOPLE, and e.l.f. Beauty’s beliefs regarding the success of the acquisition of W3LL PEOPLE. These forward-looking statements are based on management's current expectations, estimates, forecasts, projections, beliefs and assumptions and are not guarantees of future performance. Although e.l.f. Beauty believes that the expectations reflected in the forward-looking statements are reasonable, actual results and the timing of selected events may differ materially from those expectations. Factors that could cause actual results to differ materially from those in the forward-looking statements include, among other things, the risks and uncertainties that are described in e.l.f. Beauty’s most recent Quarterly Report on Form 10-Q and Annual Report on Form 10-K, as updated from time to time in e.l.f. Beauty’s SEC filings, as well as risks associated with e.l.f. Beauty’s acquisition of W3LL PEOPLE, including e.l.f. Beauty’s ability to achieve the anticipated benefits of the transaction, e.l.f. Beauty’s ability to successfully integrate W3LL PEOPLE’s operations, and unexpected costs, charges or expenses. Potential investors are urged to consider these factors carefully in evaluating the forward-looking statements. These forward-looking statements speak only as of the date hereof. Except as required by law, e.l.f. Beauty assumes no obligation to update or revise these forward-looking statements for any reason, even if new information becomes available in the future.
Note regarding non-GAAP financial measures
This press release includes references to adjusted diluted earnings per share, a non-GAAP measure. e.l.f. Beauty is not able to provide a quantitative reconciliation of adjusted diluted earnings per share to the corresponding diluted earnings per share GAAP measure without unreasonable efforts. e.l.f. Beauty cannot provide meaningful estimates of the non-recurring charges and credits excluded from adjusted diluted earnings per share due to the forward-looking nature of the estimate and its inherent variability and uncertainty. For the same reasons, e.l.f. Beauty is unable to address the probable significance of the unavailable information.