L'Oreal eyes further acquisitions to maintain growth
acquisitions in the future in an effort to maintain sales growth at
6 - 8 per cent, while confirming a 50 per cent drop in its annual
profits following merger gains in 2004.
At the company's annual finance meeting, held in Paris today, the company said that its net profits had jumped 37 per cent to reach €1.64bn, up from €1.48bn at the end of 2004 on a pro forma basis.
However, this figure does not take into consideration a €2.2 billion gain in the 2004 figures relating to the Sanofi-Aventis pharmaceuticals merger, which meant that fully stated 2004 net profit figure stood at €3.97bn, accounting for the 50 per cent drop on the 2005 full year figure.
The consideration had already been taken into account by leading financial analysts, and the final figures were generally slightly above market expectations.
Looking to the future, the company is now hoping to further boost sales growth and says it is open to both organic and external growth as a means of achieving this.
"External growth is not inconsistent with organic growth," said Jean-Paul Agon, deputy chief executive and chief executive designate at the event's press conference.
Agon stressed that this meant the company was considering all manner of paths as a means of further boosting sales growth in the coming years.
"Our ambition is to return to a comparable growth target of 6 to 8 percent a year. Pursuing this growth will be our number one priority," he added.
Although he did not give any specific time frame for this ambition, the company will be looking to improve on the 4.8 per cent like-for-like sales growth during 2005, when sales topped €14.53bn.
The 2005 full year figures also revealed that operating profit had increased by 8.5 per cent to reach €2.26bn, representing 15.6 per cent of sales.
"I plan to look at acquisition opportunities to accelerate our growth," Agon said at the end of the conference.