L’Oreal displays a beautiful start to the year
While mass-market and professional products seem to have had a relatively slow start to the year, French beauty giant L’Oreal has managed to buck this trend and deliver strong performance in the first quarter of 2017. Demand for brands like Kiehl’s helped the cosmetic titan outperform its competitors and deliver a 4.2% rise in sales against the same period a year ago.
L’Oreal’s share price has risen steadily over the past three months
Source: Yahoo Finance
L’Oreal reported revenues of €7.04 billion in the first quarter of the year. Taking currency fluctuations into account, this translates into 7.5% of growth from the year-ago quarter. Speaking to where this growth came from, the company’s CEO, Jean-Paul Argon, gave a statement, saying:
“Performance levels are consequently very differentiated across the divisions with outstanding growth for L’Oreal Luxe, a satisfactory start for Active Cosmetics, moderate growth for Consumer Products despite market share gains, and a slight drop for Professional Products.”
Western Europe saw like-for-like sales rise by 2.8%. This represented a problematic domestic market in France bolstered by “outstanding” growth in the UK, Germany and Spain. North America saw 3.8% growth, and New Markets (inclusive of Asia, Latin America, Eastern Europe, Africa and the Middle East) rose by 5.6%.
The company’s in-roads into Ecommerce are also paying dividends. Last quarter saw Ecommerce sales account for 6.8% of total sales – that’s a 27% rise from the previous year.
The company also confirmed that it completed three brand acquisitions in March from U.S. pharmaceutical company Valeant.
Dominion holds L’Oreal in its Global Trends Luxury Fund.
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