PARIS — Groupe Clarins reported second-quarter 2008 sales of 245.7 million euros, or $384.1 million at average exchange, down 3.4 percent on second-quarter 2007. At constant exchange, the company’s revenues rose 3.2 percent.
This story first appeared in the July 29, 2008 issue of WWD. Subscribe Today.
For the first half of 2008, Clarins posted sales of 485.8 million euros, or $743.5 million at average exchange, down 1.8 percent. At constant exchange, revenues rose 4.1 percent in the period.
“This respectable performance was achieved under challenging market conditions resulting from a worldwide slowdown in consumer spending, flat growth in sales volumes in the cosmetics industry, particularly fierce competition for perfumes and unfavorable foreign exchange trends for the European cosmetics industry,” the company stated.
Clarins attributed its revenue gains at constant exchange partially to “a slightly positive trend for sales volumes combined with a strong marketing plan for skin care products.”
The company’s beauty division, comprising treatment and makeup, generated revenues of 346.1 million euros, or $529.7 million at average exchange, in the first half of this year, up 1.2 percent or 7.6 percent at constant exchange rates, driven primarily by gains from Clarins’ skin care products.
The company’s perfumes division registered revenues of 139.7 million euros, or $213.8 million at average exchange, down 8.4 percent in the half. At constant exchange, the dip was 3.8 percent. Clarins stated the division’s results were due to a tough comparison base versus first-half 2007, when Thierry Mugler and Azzaro both launched products.
As a result of the “unfavorable economic environment providing limited visibility,” Clarins projects its full-year revenues will grow 4 percent at constant exchange. That’s at the low end of its former guidance of 4 to 6 percent.
“Earnings will be impacted by very unfavorable foreign exchange trends and the consequences of the group’s stated strategy of investing to support the development of its existing and new brands,” Clarins stated.
As reported, this month the Courtin-Clarins family, majority shareholders in Clarins, announced an offer worth 814.2 million euros, or $1.28 billion at current exchange, to take the company off the Paris Bourse. Their stated aim is to focus on mid- to long-term strategies.