Mecca Surpasses $1.2B Annual Revenue Milestone

Australia’s beauty powerhouse Mecca reached a new high in 2023, recording a revenue jump to $1.2 billion. This significant increase strengthens its position in the fast-expanding cosmetics market. While both revenue and profit improved, the company also took on more debt and postponed its flagship store opening, prompting questions about the implications of its ambitious growth strategy.

Founded in the late 1990s with a single boutique in Melbourne, Mecca has evolved into Australia's largest privately-owned beauty retailer. It is widely recognised for introducing international cosmetics brands to local customers and cultivating a highly loyal following. By the end of 2023, Mecca had significantly exceeded the previous year's revenue of $971 million and lifted its net profit to $27.8 million.

To support this expansion, the business increased its borrowings by $70 million, taking total liabilities to $324 million. In a break from previous years, Mecca’s directors did not award themselves dividends in 2023. This marked a shift from the $12 million distributed in 2022 and $20 million prior to that. Meanwhile, the company’s flagship Melbourne store has been delayed beyond its original mid-year opening goal, and a new date has yet to be announced.

Despite these factors, Mecca remains one of the most valuable private businesses in the country. However, the late release of financial results and ongoing talk about a potential sale have drawn attention. Even so, Mecca’s market dominance is clear. Its closest rival, Sephora, reported $313.9 million in Australian revenue last year. Adore Beauty followed with $195.7 million.

Source: The Australian, The Nightly,