First Quarter Sales
L’Oréal double-digit sales growth boosted by weak euro
The French cosmetics maker posted a 14.1% rise in revenue to €6.44 billion, commenting that currency effects contributed 8.9% to overall growth.
In Western Europe, the Garnier brand owner saw a slowdown in a sluggish environment, but still recorded growth of 1.3% like-for-like and 4% based on reported figures
Looking forward, the Paris-based firm forecast sales growth in the first quarter would be below its average for the year thanks to an improvement in demand for mass market consumer beauty products later in the year.
"Growth will come from an acceleration of the consumer division," L'Oreal Chief Executive Jean-Paul Agon said in a conference call with analysts.
The future growth is expected as, in a mass market channel that remains tense, the Consumer Products Division has gained market share, thanks to its innovations, in the skin care and hair care segments.
L'Oréal Luxe is also continuing to win market share in a channel that has made a good start to the year, while Active Cosmetics is seeing a positive trend too, as Agon explains that performances remain contrasted by division.
“L'Oréal Luxe continues to prove very dynamic and to outperform its market. Active Cosmetics maintains its strong momentum,” he says.
“The Professional Products Division is confirming its gradual improvement. The Consumer Products Division started the year as forecast, in a mass market that declined slightly in Western Europe while still growing moderately in North America.”
Towards the end of the quarter, L’Oréal announced it had finalised the acquisition of Niely in Brazil, and that it would be integrating Magic, NYX, Decléor and Carita, the strategic brands acquired in 2014, which complement and strengthen its international portfolio in key regions and categories.
“L'Oréal is also accelerating its digital transformation, especially in terms of brand activation and e-commerce development,” adds Agon.
“In an economic context that is still volatile, we confirm that we are confident in our ability to outperform the market this year once again, and to achieve growth in sales and profit."