Sighs of relief at L’Oréal, now that Covid restrictions are disappearing: people are going out more, so make-up is back on. Turnover rose 19 % in the first quarter, as sales in the shops rebounded.
Not affected by inflation
L’Oréal had a strong first quarter, says CEO Nicolas Hieronimus. Despite the invasion of Ukraine and strengthened sanitary measures in China, the cosmetics group achieved sales of 9.06 billion euros. This represents an increase of 19 % compared to a year ago, or 13.5 % on a comparable basis. The group this says is significantly better than the market.
Buying behaviour was not affected by inflation, L’Oréal notes, as both volumes and transaction values were higher. The French FMCG producer owes this in part to its premiumisation and innovation strategy: L’Oréal Luxe, Professional Products and Active Cosmetics all achieved double-digit growth. The consumer products division also continued to grow by 11 % in the first quarter.
Back to the shops
Thanks to the lifting of sanitary restrictions, there was a strong rebound in physical sales (+ 15.5 %), although e-commerce also continued to grow. Online sales already account for 25.8 % of total revenue. “Our growth was balanced across all geographic zones, with continued outstanding momentum in North America, double-digit growth in mainland China, and an acceleration in emerging markets as well as in Europe, where growth was muted by a number of lockdowns in early 2021,” Hieronimus said.
The European market achieved sales growth of 15.8 %, returning to pre-pandemic levels, thanks to strong growth in the perfume and make-up categories. Most countries, especially the United Kingdom, Spain and Italy, experienced continued sales growth. In make-up, L’Oréal also gained market share.
“While mindful of volatility and uncertainty, we remain optimistic about the outlook for the beauty market and confident in our ability to outperform the market in 2022 and achieve another year of growth in sales and profits,” the chief executive concluded.
