The Estee Lauder Companies Inc. 2007 Annual Report
Intro
Portfolio of Brands
Chairmans Message
Chief Executives Review
Product Categories
Board of Directors
Officers
Financials
Stockholder Information
Environmental Profile
Form 10-K




TRENDSPOT: FACE TIME WITH ULTRALUXE

In skin care, the future is today. Ultraluxe, high-performance treatment products are quickly becoming the newest antidote for the latest wrinkle as consumers look for alternatives to in-office procedures. Products that promise to plump, lift, firm, hydrate, contour, de-crease, erase and rescue women from the visible signs of aging are quickly gaining traction at the counter. Advanced technology is giving rise to a new generation of ultraluxe beauty where no ingredient is too luxurious or costly.

Mrs. Estée Lauder launched Advanced Night Repair, the original prestige anti-aging product, 25 years ago. Today, Advanced Night Repair is still as vivacious as the day it was launched, ranking as one of the top-selling anti-aging products in the world. The new Advanced Night Repair Concentrate received the U.K. Marie Claire Prixe d'Excellence award in 2007.

The proven performance of luxurious Re-Nutriv, where innovation meets indulgence, drove powerhouse growth around the world for this Estée Lauder favorite. Re-Nutriv's manifesto is to find the most effective anti-aging ingredients for its line of prestige serums, creams and lotions.

When it comes to luxe, La Mer is the cr¸me of choice for A-list celebrities. The brand has expanded the core line of Cr¸me de la Mer to include Gel de la Mer, a moisturizing gel cream designed for skin that needs moisturizing with a lighter touch. New Radiant Infusion and Radiant Facial from La Mer are high-potency, next-generation infusions that deliver extreme radiance, clarity, pore-minimizing and tone.



Dermatologist-recommended continues to drive consumer confidence. Clinique, the first skin care brand developed with dermatologists, is often the last stop before the dermatologist and the first stop after the dermatologist. In North America, two out of every five skin care products sold in department stores are Clinique products.

Clinique celebrates its heritage with its award-winning 3-Step line of skin care basics. New Liquid Facial Soap joins Dramatically Different Moisturizing Lotion and Clarifying Lotion as the number-one choices for cleansing and moisturizing among U.S. department store shoppers. Gentle Cleansing Acne Treatments provide a clear promise to acne sufferers worldwide. Vitamins and antioxidants for your skin? Continuous Rescue from Clinique provides a daily dose that helps skin fight the abusive effects of an aggressive environment.

Prescriptives focuses on aging concerns of women with Super Line Preventor Xtreme Intense Environmental Protection from Prescriptives. A potent cocktail of antioxidants that diminishes the appearance of lines and wrinkles by up to 54%, this anti-aging treatment takes defense against environmental assaults to a new level.

Concerns about the environment are giving rise to non-traditional alternatives for skin care products. Aveda developed Outer Peace acne treatments at the Himalayan Institute of Medicine with two Indian doctors who combined the first naturally-derived salicylic acid with botanicals for proven results in treating ongoing acne.

Health and beauty come together at Origins with Dr. Andrew Weil for Origins. The foremost authority in integrative health care believes there is no beauty without good health. His best-selling Origins products include the Plantidote Mega-Mushroom program, designed to optimize skin's health. Also new from Origins are Youthtopia Skin firming cream with Rhodiola and Skin firming lotion with Rhodiola. These patent-pending formulas trace their roots to an ancient Siberian plant. They help empower skin to rebound from damaging stress, retrieve its youthful buoyancy and reduce the look of lines and wrinkles.




Tri-Aktiline Instant Deep Wrinkle Filler is the newest in anti-aging from Good Skin. In this one groundbreaking complex, three technologically advanced agents help eliminate the appearance of wrinkles, frown lines, brow lines and under-eye lines on contact.

European pharmacies are a growing channel for skin care. This year, both Origins and Darphin are breaking fresh ground in this dynamic channel. The luxurious new Arovita C collection from Darphin was created for the new, younger generation of French women who want to take proactive measures to fight early signs of aging.

Men's skin care choices continue to expand beyond grooming. Lab Series Skincare for Men received two Grooming Awards from Men's Health magazine for Instant Moisture Eye Gel and Oil Control Daily Hydrator.

Enhanced R&D facilities in Japan provide a leading edge for developing products targeted to the unique needs of Asian skin. Nutritious by Estée Lauder, a pomegranate-based skin care solution, targets the younger Asian woman who is seeking healthy, radiant skin. The formula quickly became a top seller in Korea, Japan and Taiwan.

Finally, emerging markets such as Russia, China and Eastern Europe, where luxury skin care is the fastest growing segment, are driving growth for both Estée Lauder and Clinique. In emerging markets such as Brazil, Latin women have a long love affair with looking young. This year, our business in Latin America has excelled as the economies in these markets continue to grow.