L'Oreal's Profit Rises, Buoyed by Luxury, Online Sales
27 Juillet 2017 - 8:20PM
Dow Jones News
By Nick Kostov
PARIS--French cosmetics firm L'Oreal SA said Thursday its profit
rose in the first half of the year, fueled by strong sales in
luxury products and an increase in online sales.
Net profit increased to EUR2.04 billion ($2.38 billion) from
EUR1.48 billion a year earlier, the company said. Operating profit
rose 7.1% from a year ago to EUR2.53 billion.
Sales climbed 4% in the first half. They totaled EUR6.56 billion
in the most recent quarter, a 3.5% rise.
"In a beauty market which, as in the first quarter, turned out
to be highly contrasted and atypical, the group has continued to
expand, with solid organic growth and differentiated performances
across the divisions," Chief Executive Jean-Paul Agon said in a
statement.
L'Oreal posted a 4.3% rise in like-for-like sales in the three
months ended June 30. L'Oreal Luxe did particularly well,
benefiting from a boom in makeup sales, while L'Oreal's active
cosmetics unit that includes La Roche-Posay and Roger & Gallet
brands also performed strongly. Like-for-like sales strip out
acquisitions, disposals and currency swings.
The company's units selling professional and consumer products
grew more slowly but are improving, L'Oreal said.
Mr. Agon said he expects sales and profits to grow this year,
but didn't provide specific forecasts.
Nestle SA, which owns a 23% stake in L'Oreal, is under pressure
from Daniel Loeb's Third Point, as the hedge fund is demanding a
series of moves to boost shareholder return, including a review of
the Swiss food giant's stake in French cosmetics firm.
In its earnings release, L'Oreal didn't refer to any potential
shareholding change.
L'Oreal last month agreed to sell The Body Shop to Natura
Cosmeticos SA, after reviewing the strategic options for what has
been the company's worst-performing business in recent years. Mr.
Agon said this would allow the company to strongly increase
profitability this year and accelerate its market-share gains
Write to Nick Kostov at nick.kostov@wsj.com
(END) Dow Jones Newswires
July 27, 2017 14:05 ET (18:05 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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