Luxury Makeover Makes L’Oreal Sales Shine | Money
PARIS, April 20 ― L’Oreal said yesterday its first-quarter sales jumped nearly a fifth despite headwinds from the war in Ukraine and pandemic disruption in China as the French cosmetics giant continued its luxury strategy.
The 19% rise in sales to 9.06 billion euros (RM41.6 billion) beat analysts’ consensus of 8.8 billion euros compiled by Factset.
“In the context of the invasion of Ukraine and the strengthening of sanitary measures in China, L’Oréal had a good first quarter,” said general manager Nicolas Hieronimus.
The company, which has shifted its product portfolio to the premium segment, said the luxury division saw the strongest sales growth of 25.1%.
In recent quarters, the luxury division has become L’Oréal’s best-selling division and generated 3.46 billion euros in sales in the first three months of the year.
The division includes Lancome and Kiehl’s as well as beauty products from luxury brands such as Giorgio Armani, Prada, Ralph Lauren and Yves Saint Laurent.
The consumer products unit, which includes the L’Oreal Paris, Maybelline New York and Garnier brands, is now in second place after recording growth of 11.1% to 3.3 billion euros.
Hieronimus said consumer buying behavior has so far been unaffected by inflation and its consumer products division has managed double-digit growth despite supply chain challenges that were affecting many industries as the global economy recovered from the pandemic.
He said L’Oreal remains optimistic about the outlook for the beauty market this year and its ability to outperform the market in 2022 with increased sales and profits.
L’Oréal made a net profit of 4.6 billion euros in 2021 for a turnover of 32.3 billion. -AFP