“2013 was another year of robust growth for L’Oréal. The Group achieved sustained sales growth and, in a market whose expansion was more moderate in 2013, accelerated its outperformance versus the market,” said its Chairman and Chief Executive Officer, Jean-Paul Agon.
In 2013, the French group’s sales amounted to 22.977 billion euros, an increase of +2.3% compared to the previous year. The like-for-like sales trend of theL’Oréal Group was +5.0% and +6.0% at constant exchange rates.
Luxe and Active Cosmetics divisions drive sales
The group’s growth was driven by the L’Oréal Luxe (+5.3%) and Active Cosmetics (+4.9%) divisions.
According to the group, the L’Oréal Luxe division (Lancôme, Yves Saint Laurent, Giorgio Armani, …) grew significantly faster than the market, in all geographical areas. For instance, Lancôme’s La Vie est Belle established itself as a top seller. Travel Retail, which will form its own division in 2014, also outperformed the market.
As far as it is concerned, the Active Cosmetics division (Vichy, La Roche Posay, SkinCeauticals, …) strengthened its position as the world leader in the dermocosmetics market.
The Professional Products Division (Kérastase, Matrix, L’Oréal Professionnel, Essie, …) recorded growth of +2.1% like-for-like and -1.0% based on reported figures in a channel that was still affected by declining salon visits in the mature markets, but remains dynamic in the New Markets.
Eventually, the Consumer Products Division posted growth of +4.9% like-for-like and +1.5% based on reported figures. “The Division is outperforming the global market and winning market share,” comments .
Strong growth in “New Markets”
In terms of geographic zones, Western Europe (+1.1%) remains a strong basis for the group and North America (+2.8%) keeps on growing, despite that the market was less dynamic than in 2012.
Growth in the "New Markets" remains strong, approaching or exceeding the double digits like-for-like. However, reported figures are negatively impacted by currency fluctuations (-3.7% for the whole group). In the Asia-Pacific area, L’Oréal recorded annual growth of +8.4% (+9.5% excluding Japan) like-for-like and +2.2% based on reported figures, despite slower growth in China and India. In Latin America, L’Oréal recorded growth of +11.5% like-for-like and +3.7% based on reported figures. In Eastern Europe, sales increased by +8.2% like-for-like and +4.2% based on reported figures. Regrading Africa and Middle East, sales increased by +14.3% like-for-like and +9.0% based on reported figures, reflecting the good performances of the new subsidiary in Saudi Arabia, strong growth in the Gulf states, Egypt and Pakistan and the recent acquisition of Interbeauty in Kenya. All the Divisions recorded double-digit growth in 2013.
Positive outlook for 2014
Lastly, profitability reached a record level in 2013, with an operating profit of 3.875 billion euros, representing 16.9% of sales (up by 0.4 points).
“The quality of these results illustrates the Group’s ability to continue to deliver sustainable and profitable growth. We are starting 2014 with confidence, driven by our mission of ‘Beauty for All’, the power of our research and innovations, the strength of our portfolio of complementary brands and the globalisation of our major brands. In an economic context that is still marked by uncertainties, particularly on the monetary front, L’Oréal is confident in its ability to outperform the market once again in 2014, and to achieve another year of sales and profit growth,” concluded Mr. Agon.