French cosmetics giant L’Oreal reports “spectacular” growth for last year, particularly in Asia.
It had growth acceleration of 5.5 per cent in the fourth quarter with sales exceeding €10 billion (US$12.2 billion) in the ‘new markets’, which include Asia Pacific.
Operating margin reached a record 18 per cent.
Sales were €26 billion, up 4.8 per cent like-for-like, 2 per cent at constant exchange rates and 0.7 per cent on reported figures.
Representing a record 18 per cent of sales, the operating profit was €4.68 billion.
“L’Oreal had a good year with sustained sales growth momentum and robust profits,” says chairman/CEO Jean-Paul Agon.
The second half accelerated compared with the first, particularly in the fourth quarter.
Sales grew in all divisions, especially L’Oreal Luxe in Asia. The Active Cosmetics Division achieved more than €2 billion of sales for the first time.
The new markets exceeded more than €10 billion in sales for the first time ever. The Asia Pacific zone had growth of 12.3 per cent like-for-like and 9.2 per cent reported. In Northern Asia, Chinese consumers are driving growth, particularly for the L’Oreal Luxe Division in China and Hong Kong. China’s growth was fuelled by strong e-commerce results. In Southern Asia, India is proving dynamic, while Malaysia and Thailand are also growing strongly.
Overall, operating profit, at €4.6 billion, has grown by 3 per cent and amounts to 18 per cent of sales, representing an increase of 40 basis points. Excluding exchange rates, operating profit grew by 4.4 per cent.