L'Oreal announces industry-leading growth, again

By Simon Pitman

- Last updated on GMT

Related tags: Percent, Europe, United states, Spain

The world's largest cosmetics company has once again revealed
industry-leading growth, with like-for-like sales up an impressive
6.6 percent.

The company said that strong growth in Asia, Latin America and Eastern Europe had helped to boost sales to €4.42bn, a figure that largely met analysts' expectations. The figures were particularly impressive in light of the negative impact of exchange rates during the quarter, which had led the Euro to fluctuate against leading currencies. "We achieved a quite exceptional 4th​ quarter, bolstered by a large number of initiatives, enabling us to end 2007 at +8 percent [like-for-like], right at the top of our target range,"​ said Jean-Paul Agon, L'Oreal CEO. Total revenues for 2008 amounted to €17.1bn and share prices jumped over 10 percent on the Paris Bourse when the results were announced, January 24. Western Europe returns to stronger growth ​ Western Europe was reported to have continued its return to stronger growth, while the performance was considered 'satisfactory' in North America, despite the challenging retail conditions. For the quarter sales in the US, sales rose by 7.2 percent on a like-for-like basis, while Western European sales rose by 5.3 percent. However, it was in the group's other global markets where growth really excelled, accounting for a fourth quarter rise of 17 per cent in like-for-like revenues. Eastern Europe led the way with a fourth quarter rise of 28.6 percent in like-for-like sales, driven particularly by a marked rise in the performance of the Russian and Polish markets. China boosts Asian results ​ Meanwhile growth of 15.5 per cent for the quarter was registered in Asia, where a marked growth in the Chinese market helped to counteract relatively low growth of 1.8 percent in the perennially competitive Japanese market. Latin America reported a fourth quarter like-for-like sales growth of 13.1 percent, driven by 'spectacular' rises in Argentina, Colombia, Venezuela and the company's recently formed subsidiary in Panama. Once again leading growth was experienced in the company's Active Cosmetics market, with sales for the quarter up 14.2 percent, closely followed by an increase of 12.1 percent for the luxury cosmetics division during the same period. Like-for-like sales for The Body Shop grew by 4.1 percent, whereas sales for the company's Dermatology business grew by 14.5 percent. The company said that The Body Shop sales had been held back during the all-important fourth quarter due to delays with a subcontractor that caused the availability of certain products to be disrupted. Full results, revealing the company's net and operating profits are expected to be revealed on February 13, followed by a financial analysis meeting on February 14.

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