by Mimosa Spencer
PARIS (Reuters) – L’Oréal on Thursday reported an increase in sales in China in the second quarter, overcoming the downward trend seen in the sector in the country due to health restrictions in the face of COVID-19, on demand rebound background for cosmetic products.
In a press release, the group indicated that its overall sales over the April-June period amounted to 9.31 billion euros, an increase of 13.4% on a like-for-like basis, beating the consensus which came out at +8. .9% according to Visible Alpha data cited by UBS.
The CEO of L’Oréal underlined the solid rebound in demand for cosmetic products, as the end of the health crisis resulted in an acceleration of social life.
“After two years of the pandemic, consumers are happy to return to a more intense social life and want to indulge themselves with innovative and high-quality beauty products, which is stimulating the beauty market,” said Nicolas Hieronimus in a communicated.
In North America, second-quarter sales rose 10.7% on a like-for-like basis as consumers flocked to stores to purchase perfumes and other cosmetics.
While many Western brands saw a decline in sales in China, where containment measures were imposed in mid-March to combat a resurgence of the COVID-19 epidemic, L’Oréal saw its figure of business in the country grew by 13% over the April-June period.
Nicolas Hieronimus attributed this performance in China to online sales, stressing in an interview with Reuters that L’Oréal was “really thriving” in the country.
The turnover of the consumer products division, which notably includes the brands Maybelline and L’Oréal Paris, increased by 9.1% like-for-like, as consumers shrugged off the rise in prices to continue to buy cosmetics.
As for L’Oreal Luxe, of which the Yves Saint Laurent brand is a part, sales in the second quarter rose 15.3% like-for-like, a performance superior to that of the perfume and cosmetics division of rival LVMH.
Despite the uncertainties for the second half of 2022, L’Oréal is “rather confident” overall for its results.
“Aware of the current uncertainties and instability (…) we remain optimistic about the outlook for the global beauty market and confident in our ability to outperform the market to deliver another year of revenue growth in 2022. business and results”, said Nicolas Hieronimus.
(Mimosa Spencer report, written by Jean Terzian, edited by Jean-Michel Bélot)