LONDON — L’Oréal issued a statement Monday denying British press reports that it is considering selling The Body Shop.
The U.K.’s Mail on Sunday had quoted Mark Constantine, the founder of Lush Cosmetics, as saying that L’Oréal planned to sell The Body Shop as the firm “doesn’t fit L’Oréal’s profit profile.” The article noted that Constantine had spoken to a Body Shop “source,” and reported that Constantine, whose company makes natural cosmetics similar to those produced by The Body Shop, had once been interested in acquiring the firm.
In Monday’s statement, a spokeswoman for L’Oréal countered: “There is absolutely no truth in the rumor that L’Oréal intends to sell The Body Shop. In an interview with the Financial Times on September 27, 2012, Jean-Paul Agon, chairman and ceo [of] L’Oréal, explicitly denied any intention to sell and added that ‘The Body Shop is the kind of treasure that we are very happy to have.’”
The Body Shop’s business has recently been picking up steam.
“Over the last three quarters, The Body Shop has delivered organic top-line growth of plus 6 percent, a clear acceleration over the anemic low single-digit growth reported over the preceding years, reflecting that the work done on product portfolio and stores, coupled with a rapidly growing online presence, has started to pay off,” said UBS analyst Eva Quiroga. “Over the same period, profitability has been improving with margins now in high-single digits, although it remains well below group average.”
L’Oréal acquired The Body Shop in 2006 for 652 million pounds, which at the time was worth $1.14 billion.