L’Oréal 2007 annual sales up 8%; The Body Shops reports a plus of 5.7%
The sales of the L’Oréal group, at December 31st 2007, amounted to € 17.063 billion, an increase of + 8.1% (based on reported figures). Like-for-like (i.e. based on a comparable structure and identical exchange rates), the increase in the group’s sales was + 8.0 %. The impact of changes in consolidation, as a result of the acquisitions of The Body Shop, Sanoflore, Beauty Alliance, PureOlogy and Maly’s West, amounted to + 3.6%. The currency fluctuations had a negative impact of -3.5% for the full year 2007. Growth excluding the exchange rate impact was + 11.6%.
Commenting on these figures, Mr. Jean-Paul Agon, Chief Executive Officer of L’Oréal, said: “We achieved a quite exceptional 4th quarter, bolstered by a large number of initiatives, enabling us to end 2007 at +8%, right at the top of our target range. All the Divisions proved highly successful and made strong contributions to this result. All the zones played a part in this achievement. Western Europe confirmed its return to growth; performance in North America was satisfactory over the year as a whole; and our growth in the Rest of the World accelerated, with very strong increases in Eastern Europe, Asia and Latin America. This solid organic growth, together with several strategic acquisitions, means that the group has once again advanced significantly faster than the worldwide cosmetics market. Overall, and despite the negative impact of exchange rates which was more pronounced in the 4th quarter, we are confirming our target of double-digit net earnings per share growth.”
The Professional Products Division (L’Oréal Professionnel ,Redken, Shu Uemura, Kérastase, etc.) recorded strong like-for-like growth of +7.5%. The Consumer Products Division (L’Oréal Paris, Garnier, Maybelline New York, etc.) posted like-for-like growth of +7.9% in 2007, a very significant acceleration compared with previous years. The Luxury Products Division (Lancôme, Helena Rubinstein, Armani, Diesel, Shu Uemura, etc.) ended the year with +8.4% like-for-like growth, with a fourth quarter at +12.1%, driven by successful product initiatives. The growth of Active Cosmetics (Vichy, La Roche-Posay, Sanoflore, etc.) continued at the high rate of +10.8% like-for-like, with a strong 4th quarter at +14.2%. Growth in Western Europe amounted to + 4.1% like-for-like, as the market trend appears to have held up well. Sales trends rose very significantly in the United Kingdom and Spain. In France and Germany trends improved in the second half of the year.
With market growth slower than in 2006, the group’s sales growth in North America amounted to +4.8%, with a strong 4th quarter (+7.2%). The strong dynamism of markets continued in all the regions. With a growth rate of +17.9% in the Rest of the World zone over the whole year, the group has greatly increased its penetration.
The Body Shop:
Like-for-like sales growth at The Body Shop amounted to +5.7%. Retail sales(1) increased by +7.9%. With a comparable store base (2), the increase in sales amounted to +3.3%. According to the company announcement sales at the end of the year, traditionally the strongest period, were marked by a belated but good level of store frequentation, and the success of gift box sales. 4th quarter sales were held back by the difficulties of a large industrial subcontractor, causing disruptions in the availability of certain products. Over the full year, trends in retail sales with a comparable store base were favourable in Western Europe. Growth was rapid in the Rest of the Word, and in Russia, India, Hong Kong and Japan. There were contrasting performance trends in the United States.
161 stores were opened during 2007, taking the total to 2,426. The brand is now established in 59 countries.
(1) Retail sales: total sales to consumers through all channels.
(2) Retail sales with a comparable store base: total sales to consumers by stores which operated continuously from January 1st to December 31st 2006 and over the same period in 2007.
