Hong Kong-listed L’Occitane says global sales increased 11.7 per cent last financial year – largely driven by Hong Kong and China.

The skincare and cosmetics brand achieved sales growth in every market in Asia and beyond.

In Hong Kong, where the company expanded its store network from 32 to 36, the company posted sales of euro 23.5 million, up 21.2 per cent in local currency.

In China, where it expanded its network by 25 to 161, its sales reached euro 23.1 million, up 28.9 per cent.

Total global sales topped euro 1.178 billion with same store sales up 5.7 per cent. China and Hong Kong were the fastest growing markets at constant exchange rates as well. Net profit rose 35.7 per cent to euro 125.6 million.

The company attributed the positive results to careful brands positioning, pricing, online activities and favourable exchange rates.

“The continued investments in product innovation, merchandising, digital and CRM initiatives, marketing as well as sales distribution channels enabled the group to cater the growing demand for our high quality products,” said the company in its earnings statement.

“The management has adopted a selective multi-channel approach to boost sales and expects investments in the digital and travel retail channels as key drivers of future growth. The continuous upgrading and expanding of our retail network, selectively and carefully, through store renovations and relocations has started to bear fruits. All key markets delivered growth in local currency.”

L’Occitane’s net sales in Japan rose by six per cent, or by 8.8 per cent on constant exchange rate basis, contributing 14.4 per cent to overall growth. The company said Japan’s improvement was the result of successful product launches, new store openings and renovations, increased media and marketing investments and an overall increase in tourist purchases.

“The turnaround in Japan market reflected management’s endeavor in executing a consistent strategy in the past few years and to enhance the brand’s premium positioning in Japan which is the biggest market of the group. The strong growth of Melvita in Japan also presents a great opportunity to further build this emerging brand and unlock its full potential.”

Taiwan’s net sales rose 7.3 per cent, or by2.6 per cent on constant exchange rates.

The healthy same store sales growth was attributable to successful new product launches, and an improvement in the retail store network, the company said.  Non-comparable stores, however, recorded a drop of 6.2 per cent, mainly due to the disposal of the Melvita business to a local distributor in 2014.

Plan to strengthen other brands

L’Occitane said that with its ongoing commitment to a multi-brand strategy, the group will especially strengthen brand recognition in the year ahead for its emerging brands like Melvita, L’Occitane Au Brésil and Erborian through effective marketing campaigns.

“The group will continue to revamp its Melvita brand and to introduce its Erborian brand to more markets, in turn further grow its brand portfolio.”

The group also plans to implement a new marketing program to enhance the L’Occitane brand awareness in global markets. It says it will adopt measures focusing on digital marketing, marketing communication, product sampling as well as the opening of appealing flagships with optimised footfall and sales conversion. More details and progress will be reported on a regular basis.

“The group will continue to preserve and enhance the identity of its star brand L’Occitane en Provence as well as other emerging brands through multiple channels. Besides its directly owned, renovated retail shops, the group is focusing on retailing its natural ingredient based well-being products through travel retail, online marketplace, as well as efficient wholesale channels.

“The booming trend of travel retail around the world and ever-growing eCommerce market in China allows us opportunity for market outreach. The group will adopt effective marketing approaches, online and offline, in order to further lift up its brand profile and to cater the growing demand in these platforms.”