Asia Pacific region and the UK drive L’Occitane results

By Simon Pitman

- Last updated on GMT

Related tags Asia pacific region Retailing

L’Occitane’s expansion into China, funded by a recent IPO on the Hong Kong stock exchange, has helped drive a big increase in sales for the first half of its financial year.

The company said that the interim results ending in September showed that sales had increased by nearly 27 per cent to reach €3331.2m, compared to the same period last year.

Operating profit for the six month period grew by 17.6 per cent to €38.1m compared to €32.4m last year, while net profit grew by 19.1 per cent to €29.8m.

The company stressed that growth was attributable to strong performances in certain key markets, particularly in the United Kingdom, which helped to counterbalance an otherwise relatively quiet European market.

Hong Kong and China lead the way

Otherwise, growth was largely derived from developing markets, with sales roaring ahead in both Hong Kong and China, growing 35.0 per cent and 34.5 per cent respectively, while in Russia sales for the period grew by 26.2 per cent.

The Asia Pacific region has been a significant focus of expansion for the company of late, something that was reflected in the fact that combined sales achieved in the China, Hong Kong, Taiwan and Japan markets now account for 37.9 per cent of the total turnover for the period.

Significant gains were also reported in South Korea and Mexico, as well as Germany, where a marked recovery helped drive gains of over 40 per cent.

Retail sales remain the driving force of the business

The figures also revealed that, after dividing the sales according to its three principal divisions, the Sell-Out division accounted for €236.4m of the total sales, Sell-In €82.3m and the B-to-B segment was €12.5m.

CEO Reinold Geiger said that the results reflected the companies ambitions to continue ‘to implement our strategic plan in boosting sales growth and strengthening our presence worldwide’.

In line with its expansion plans, the company also pointed to the fact that it has been increasing the number of its retail outlets on a global basis, testified by the fact that during the six month period the number of stores expanded from 1,507 in 2009 to 1,642.

Store expansion continues

Of this increase, there were 42 additional own retail stores in the Asia Pacific region, a further 49 in Europe and 5 new store openings in the Americas region.

In the next six months the company said it plans to invest in further new store openings in emerging markets, while concentrating on upgrading and renovating stores in the more mature markets.

Likewise, there will also be an enhanced marketing and advertising campaign aimed at enhancing awareness of the L’Occitane and Meivita brands on a global basis, as well as a continued effort to optimise the global supply chain.

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