07.19.16
$7.3 billion
KEY EXECUTIVES:
Hubert Sagnières, Chairman and CEO
Géraldine Picaud, Chief Financial Officer
Jean Carrier-Guillomet, Chief Operating Officer
Paul du Saillant, Chief Operating Officer
Laurent Vacherot, Chief Operating Officer
Norbert Gorny, Chief Research and Development Officer
Eric Léonard, President, Essilor of America
Eric Bernard, President, AMERA (Asia/Pacific, Middle East, Russia, and Africa)
Eric Thoreux, President, Sun, Readers, and Photochromics
Réal Goulet, Sr. VP, Rx Sunwear
NUMBER OF EMPLOYEES: 60,883
GLOBAL HEADQUARTERS: Charenton-le-Pont, France
Essilor’s mantra is “seeing the world better,” and nothing epitomizes that sentiment more than the launch of a new, philanthropic initiative.
In January 2015, Essilor created the “Vision for Life” program. The company committed 30 million euros to the campaign, making it the largest strategic program dedicated to eliminating Uncorrected Refractive Error (URE), or as it’s more commonly known, poor vision. “The launch of the Vision For Life program is a natural sequel to the creation of our Corporate Mission division in 2013 and provides impetus to our efforts to bring good vision to everyone, everywhere in the world. By addressing the vast unmet vision correction needs, we can make a lasting impact on the lives of individuals and on human development worldwide,” Hubert Sagnières, chairman and CEO of Essilor International, said in a company press release.
“We are very excited to be marking a new page in the history of the fight against poor vision,” commented Jayanth Bhuvaraghan, Essilor’s chief corporate mission officer. “Vision for Life is a global strategic giving program that will fund, monitor, and measure the impact of projects showing the most potential to scale up and improve the lives of as many people as possible through improved access to vision care.”
During the year, the initiative accomplished a great deal for those suffering from poor vision without the means to correct it:
Financial Landscape
Essilor’s business is divided into three operating segments: lenses and optical instruments, sunglasses and readers, and equipment. The company had quite a successful year in terms of revenue, reporting 6.7 billion euros ($7.33 billion), a whopping 18.4 percent increase from 2014. Noteworthy in terms of breaking records, Essilor achieved a historically high contribution from operations, which accounted for 18.8 percent of revenue, largely in part due to gains from the company’s 2014 acquisition of Transitions Optical—its largest deal to date.
Essilor’s most profitable and arguably most well-known division is its lenses and optical instruments segment, which consists of corrective lenses and optical instruments intended for optician and optometrist use. The company’s lenses—which actually allow some of the MPO staff to effectively perform their jobs—are fairly household names; Crizal, Transitions, Varilux, and Xperio are among the most recognizable. That said, the lenses and optical instruments division experienced a strong fiscal year in 2015 (ended Dec. 31). Total revenue amounted to 5.84 billion euros, a 17.5 percent bump from 2014. Lenses and optical instruments accounted for 87 percent of Essilor’s total revenue in 2015.
The North American region of the lenses and optical instruments division (Essilor only breaks this section down by region) generated 39 percent of total group revenue with 2015 sales of 2.6 billion euros, a 26.9 percent increase from the prior year. Essilor enacted a steady rollout of consumer advertising campaigns in the still-expanding U.S. market in 2015, which brought about strong sales of the “big four” lenses previously mentioned. The region’s success was also a result of two partnerships formed with platforms delivering services to independent optometrists, which broadened Essilor’s presence in the optical products retailing segment.
While not quite as dramatic as the domestic market’s growth, the remaining global regions’ lenses and optical instruments revenue is still something to keep a close eye on. In 2015, European net sales (26 percent of total group revenue) grew to 1.8 billion euros, a 7.5 percent increase from the previous year, driven by similar consumer marketing campaigns enacted in the United States. The Asia/Pacific/Middle East/Africa region (16 percent of total group revenue) nearly matched the North American region’s impressive growth, with a 19.3 percent bump from the prior year. Latin American region (6 percent of total group revenue) net sales rose 6.2 percent from 2014, according to Essilor’s 2015 annual report.
The sunglasses and readers segment generated 503 million euros in revenue; the total represented the largest overall growth of any business segment in 2015, with a 33.9 percent gain from the previous year. Essilor reached a larger number of consumers in 2015, due to the acquisition of the U.S. Costa and Chinese Bolon trademarks. The company’s equipment division, with 2015 revenue of 203 million euros, was up 2.7 percent from 2014.
Strategic ‘Vision’
Essilor’s acquisitions and partnerships strategy bore quite a significant amount of fruit in 2015. The company closed 19 transactions throughout the year, bringing in about 214 million euros in revenue and strengthening its position in the corrective lens, sunlens, and online retailing markets. In July 2015, Essilor of America announced the purchase Vision Source, then North America’s largest independent optometric service alliance (with nearly 4,000 members). The organization reported $2.2 billion in sales from more than 3,000 locations in 2014. Though the deal represented quite a promising opportunity, different opinions abounded as to what the acquisition would mean for independent optometrists.
“I think the purchase is a big win for independent practice,” said Scott Schachter, OD, Vision Source administrator in Pismo Beach, Calif., in an Optometry Times interview. “Essilor has been an excellent partner to Vision Source for many years, providing proprietary products at exceptional value. In addition, Essilor has supported our practices with staff training and education, sponsoring the Vision Source Representative program for many years, and more.”
But some remained cautious about what the deal meant for independent optometry.
“Virtually every time something gets a big foothold in optometry, it screws us,” Steve Nelson, OD, said in the Optometry Times interview. “That’s true whether it’s Luxottica or VSP. They virtually all start out as a ‘partner to optometry’ and all end up getting too large to be a good partner to us and end up with a business model using optometry to generate huge profits. At that point, we are too invested to back away and we just have to take it. I’m not saying this will screw us because maybe this time will be different, but history certainly suggests we should view this with a fair measure of skepticism.”
Product News
Prolific as ever, in 2015 Essilor introduced about 250 new products and filed 139 new patent applications worldwide. During the year, the company continued its commitment to research and development by opening its first Wearers Evaluation Center in Singapore to test new research and development theories, product concepts, and prototypes with end users, as well as a new development and evaluation center in Danyang (China).
According to the company, as of September 2015, more than 1.5 billion people used a smartphone daily, and nine out of 10 people declared spending more time using digital screens than they did two years ago. In fact, according to the Vision Council, some millennials spend at least nine hours a day in front of a digital screen. With that in mind, Essilor launched its Eyezen glasses, specially designed to defend the constantly connected against the eyestrain of staring at digital devices. At the SILMO World Optical Show in late September, Eyezen received a gold innovation award (Silmo d’Or), which honors values intrinsic to the profession.
The glasses are enhanced with magnification in the lens’s lower section, alleviating eyestrain from viewing text and small screens on tablets and smartphones. They also filter harmful blue-violet light emitted by any number of digital devices. “The technology in Eyezen glasses supports the digitally connected lifestyle of the millennial generation—a lifestyle they aren’t willing to change—by reducing eyestrain and exposure to harmful blue light,” said Lauri Crawford, senior vice president of marketing of Essilor of America.
While Essilor focuses most of its efforts on corrective lenses, the company does develop a number of fashionable—yet still health-conscious—sunglasses. One such example released in 2015 was the Haven Signature collection of polarized sunglass fits, designed to be worn over prescription glasses or readers. With an eye toward fashion, the company incorporated the latest trends, including crocodile and leopard patterns, crystals, and tasteful metal bars.
KEY EXECUTIVES:
Hubert Sagnières, Chairman and CEO
Géraldine Picaud, Chief Financial Officer
Jean Carrier-Guillomet, Chief Operating Officer
Paul du Saillant, Chief Operating Officer
Laurent Vacherot, Chief Operating Officer
Norbert Gorny, Chief Research and Development Officer
Eric Léonard, President, Essilor of America
Eric Bernard, President, AMERA (Asia/Pacific, Middle East, Russia, and Africa)
Eric Thoreux, President, Sun, Readers, and Photochromics
Réal Goulet, Sr. VP, Rx Sunwear
NUMBER OF EMPLOYEES: 60,883
GLOBAL HEADQUARTERS: Charenton-le-Pont, France
Essilor’s mantra is “seeing the world better,” and nothing epitomizes that sentiment more than the launch of a new, philanthropic initiative.
In January 2015, Essilor created the “Vision for Life” program. The company committed 30 million euros to the campaign, making it the largest strategic program dedicated to eliminating Uncorrected Refractive Error (URE), or as it’s more commonly known, poor vision. “The launch of the Vision For Life program is a natural sequel to the creation of our Corporate Mission division in 2013 and provides impetus to our efforts to bring good vision to everyone, everywhere in the world. By addressing the vast unmet vision correction needs, we can make a lasting impact on the lives of individuals and on human development worldwide,” Hubert Sagnières, chairman and CEO of Essilor International, said in a company press release.
“We are very excited to be marking a new page in the history of the fight against poor vision,” commented Jayanth Bhuvaraghan, Essilor’s chief corporate mission officer. “Vision for Life is a global strategic giving program that will fund, monitor, and measure the impact of projects showing the most potential to scale up and improve the lives of as many people as possible through improved access to vision care.”
During the year, the initiative accomplished a great deal for those suffering from poor vision without the means to correct it:
- A large-scale awareness-raising and eye test operation took place on the Journée des Oubliés des Vacances (for children who do not have the opportunity of a vacation) organized by the Secours populaire français. The event provided 70,000 families and children from disadvantaged backgrounds with information, raising their awareness of visual disorders, and more than 1,000 children were given an eye test.
- Implementation of a PASS-O (permanence d’accès aux soins de santé en milieu ophtalmologique), which provides access to ophthalmology care for people without medical insurance in a healthcare center run by the Adolphe de Rothschild Foundation, with the involvement of the Vision for Life program. This new structure, the largest in France in the field of ophthalmology, will allow 3,000 underprivileged individuals to be seen for a full vision care pathway and the provision of optical equipment if required.
- Several projects were undertaken in Africa, including in Tunisian and Moroccan schools, where over 3,000 children were given an eye exam and then provided with eyeglasses.
- In Ethiopia, Essilor worked with British NGO Vision Aid Overseas and UK Aid to screen more than 120,000 people between 2014 and 2015.
Financial Landscape
Essilor’s business is divided into three operating segments: lenses and optical instruments, sunglasses and readers, and equipment. The company had quite a successful year in terms of revenue, reporting 6.7 billion euros ($7.33 billion), a whopping 18.4 percent increase from 2014. Noteworthy in terms of breaking records, Essilor achieved a historically high contribution from operations, which accounted for 18.8 percent of revenue, largely in part due to gains from the company’s 2014 acquisition of Transitions Optical—its largest deal to date.
Essilor’s most profitable and arguably most well-known division is its lenses and optical instruments segment, which consists of corrective lenses and optical instruments intended for optician and optometrist use. The company’s lenses—which actually allow some of the MPO staff to effectively perform their jobs—are fairly household names; Crizal, Transitions, Varilux, and Xperio are among the most recognizable. That said, the lenses and optical instruments division experienced a strong fiscal year in 2015 (ended Dec. 31). Total revenue amounted to 5.84 billion euros, a 17.5 percent bump from 2014. Lenses and optical instruments accounted for 87 percent of Essilor’s total revenue in 2015.
The North American region of the lenses and optical instruments division (Essilor only breaks this section down by region) generated 39 percent of total group revenue with 2015 sales of 2.6 billion euros, a 26.9 percent increase from the prior year. Essilor enacted a steady rollout of consumer advertising campaigns in the still-expanding U.S. market in 2015, which brought about strong sales of the “big four” lenses previously mentioned. The region’s success was also a result of two partnerships formed with platforms delivering services to independent optometrists, which broadened Essilor’s presence in the optical products retailing segment.
While not quite as dramatic as the domestic market’s growth, the remaining global regions’ lenses and optical instruments revenue is still something to keep a close eye on. In 2015, European net sales (26 percent of total group revenue) grew to 1.8 billion euros, a 7.5 percent increase from the previous year, driven by similar consumer marketing campaigns enacted in the United States. The Asia/Pacific/Middle East/Africa region (16 percent of total group revenue) nearly matched the North American region’s impressive growth, with a 19.3 percent bump from the prior year. Latin American region (6 percent of total group revenue) net sales rose 6.2 percent from 2014, according to Essilor’s 2015 annual report.
The sunglasses and readers segment generated 503 million euros in revenue; the total represented the largest overall growth of any business segment in 2015, with a 33.9 percent gain from the previous year. Essilor reached a larger number of consumers in 2015, due to the acquisition of the U.S. Costa and Chinese Bolon trademarks. The company’s equipment division, with 2015 revenue of 203 million euros, was up 2.7 percent from 2014.
Strategic ‘Vision’
Essilor’s acquisitions and partnerships strategy bore quite a significant amount of fruit in 2015. The company closed 19 transactions throughout the year, bringing in about 214 million euros in revenue and strengthening its position in the corrective lens, sunlens, and online retailing markets. In July 2015, Essilor of America announced the purchase Vision Source, then North America’s largest independent optometric service alliance (with nearly 4,000 members). The organization reported $2.2 billion in sales from more than 3,000 locations in 2014. Though the deal represented quite a promising opportunity, different opinions abounded as to what the acquisition would mean for independent optometrists.
“I think the purchase is a big win for independent practice,” said Scott Schachter, OD, Vision Source administrator in Pismo Beach, Calif., in an Optometry Times interview. “Essilor has been an excellent partner to Vision Source for many years, providing proprietary products at exceptional value. In addition, Essilor has supported our practices with staff training and education, sponsoring the Vision Source Representative program for many years, and more.”
But some remained cautious about what the deal meant for independent optometry.
“Virtually every time something gets a big foothold in optometry, it screws us,” Steve Nelson, OD, said in the Optometry Times interview. “That’s true whether it’s Luxottica or VSP. They virtually all start out as a ‘partner to optometry’ and all end up getting too large to be a good partner to us and end up with a business model using optometry to generate huge profits. At that point, we are too invested to back away and we just have to take it. I’m not saying this will screw us because maybe this time will be different, but history certainly suggests we should view this with a fair measure of skepticism.”
Product News
Prolific as ever, in 2015 Essilor introduced about 250 new products and filed 139 new patent applications worldwide. During the year, the company continued its commitment to research and development by opening its first Wearers Evaluation Center in Singapore to test new research and development theories, product concepts, and prototypes with end users, as well as a new development and evaluation center in Danyang (China).
According to the company, as of September 2015, more than 1.5 billion people used a smartphone daily, and nine out of 10 people declared spending more time using digital screens than they did two years ago. In fact, according to the Vision Council, some millennials spend at least nine hours a day in front of a digital screen. With that in mind, Essilor launched its Eyezen glasses, specially designed to defend the constantly connected against the eyestrain of staring at digital devices. At the SILMO World Optical Show in late September, Eyezen received a gold innovation award (Silmo d’Or), which honors values intrinsic to the profession.
The glasses are enhanced with magnification in the lens’s lower section, alleviating eyestrain from viewing text and small screens on tablets and smartphones. They also filter harmful blue-violet light emitted by any number of digital devices. “The technology in Eyezen glasses supports the digitally connected lifestyle of the millennial generation—a lifestyle they aren’t willing to change—by reducing eyestrain and exposure to harmful blue light,” said Lauri Crawford, senior vice president of marketing of Essilor of America.
While Essilor focuses most of its efforts on corrective lenses, the company does develop a number of fashionable—yet still health-conscious—sunglasses. One such example released in 2015 was the Haven Signature collection of polarized sunglass fits, designed to be worn over prescription glasses or readers. With an eye toward fashion, the company incorporated the latest trends, including crocodile and leopard patterns, crystals, and tasteful metal bars.