France-based organic cosmetic provider L’Occitane has shown a big rise in its turnover for the most recent quarter on the back of a strong performance in markets outside of Europe.
The company said that its unaudited results for the quarter ending in September showed that net sales had increased by 21.9 per cent to €449.2m, which represented a rise of 13.5 per cent in local currencies, a figure that underlined a positive impact from currency translations.
The results were mainly driven by a strong performance in markets such as the United States, Hong Kong, Russia and China, propping up a less dynamic picture in the European market, although all business units and most countires were said to have reported increased revenues.
Net profits up 15.8 per cent
Operating profit was up 27.9 per cent to €41.9m, while net profit for the period rose by 15.8 per cent to €34.5m, representing a net profit margin of 7.7 per cent.
The company said that the increase in profits was mainly down to the sustained sales growth with the group, together with a rise in the operating margin.
Some of the growth was realized by new store openings, where the company has been concentrating on establishing retail outlets in new markets. This meant that new retail locations rose from 2,082 in the period six months prior, to 2,218 locations.
Most countries deliver local currency growth
“Despite a challenging global economic environment, most countries delivered strong growth in local currency and the Company improved the operating profit margin in the first half of FY2013, which demonstrates the resilience of L’Occitane’s business model and highlights its track record of sustainable growth,” the company said in its financial statement.
The company said that Russia and China were the strongest performing markets, with sales rising 35.0 per cent and 22.7 per cent respectively in local currencies.
“Apart from our global retail expansion strategy for new store openings and important store renovations, we will continue our investments to further strengthen our business platform for future growth," said Reinold Geiger, Chairman and CEO of L’Occitane.
“The digital online channel remains a key area of focus and growth driver for the Company. Increased spending has been allocated to this channel to enhance our internet presence and we are seeing strong developments in our e-commerce business.”
The company said that during the second half of its financial year, which will also entail the highly important Christmas holiday season, it was hoping to explore the possibility of further acquisition as a means of expanding its market position.