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Clarins Sales Up 8 Percent in 3rd Quarter

Driven by sustained growth in its beauty division, gains in its fragrance branch and recovery of orders in the U.S., Groupe Clarins posted third-quarter 2007 sales of 231.8 million euros, or $318.5 million at average exchange, up 8 percent on the same...

PARIS — Driven by sustained growth in its beauty division, gains in its fragrance branch and recovery of orders in the U.S., Groupe Clarins posted third-quarter 2007 sales of 231.8 million euros, or $318.5 million at average exchange, up 8 percent on the same prior-year period. At constant exchange, company revenues rose 10.8 percent.

However, Clarins reiterated in a statement that its operating margin will remain under pressure in the second half of 2007, due to the outlay supporting its brands, the restructuring of its U.S. subsidiary and the launch of My Blend by Dr. Olivier Courtin.

In the first half of 2007, Clarins’ operating margin, at 8.1 percent, declined 2.9 points.

During the third quarter ended Sept. 30, the company’s beauty division, comprising makeup and skin care activities, generated 153.1 million euros, or $210.4 million, up 4.2 percent. At constant exchange, its sales rose 7 percent. The company’s fragrance business registered revenues of 67.2 million euros, or $92.3 million, a 17.9 percent hike or 20 percent uptick at constant exchange.

Meantime, Clarins’ distribution activity rang up 11.5 million euros, or $15.8 million, a 7.5 percent gain on the same period in 2006. At average exchange, it increased 8.6 percent.

In the nine-month period, Clarins’ consolidated sales reached 726.4 million euros, or $976.5 million, up 5.4 percent or 8.1 percent at constant exchange.

In North America, business in the period was buoyed by the placement of new products and the recovery of department store orders, said Clarins. Revenues in North America reached 114.7 million euros, or $154.2 million, down 7.6 percent or a 0.6 percent dip at constant exchange. (That is versus a 15.7 percent drop to 72.3 million euros, or $96.1 million at average exchange, in the first half of 2007. At constant exchange, that decline came in at 8.8 percent.)

Clarins maintains its guidance of 6 percent revenues growth at constant exchange for the full year.

This story first appeared in the October 19, 2007 issue of WWD.  Subscribe Today.