PARIS — L’Occitane en Provence, the natural beauty maker and seller, is looking to drive business through store openings and developing in other retail channels, such as the Internet.
This story first appeared in the April 22, 2011 issue of WWD. Subscribe Today.
The company was listed in May 2010 on Hong Kong’s stock exchange. L’Occitane, whose shares initially available were 160-times oversubscribed, reportedly raised 5.49 billion Hong Kong dollars, which at the time was equivalent to $707 million.
“It was a very successful IPO,” said Reinold Geiger, L’Occitane’s chairman and chief executive officer, who added the company went public to have organic growth. “And this means that we have many additional opportunities to open stores.”
Today, L’Occitane has approximately 1,600-plus doors of which 750 are wholly owned.
“We can probably double [the number of] our own stores,” he said, without specifying in what time frame. Geiger also plans to double L’Occitane’s sales.
For the nine months ended Dec. 31, 2010, the company’s revenues increased 26.5 percent to 585.5 million euros, or $765.7 million at average exchange for the period. Minus foreign currency translation effects, sales gained 15.3 percent on-year.
L’Occitane has been sold on QVC in the U.S. and U.K. for about a decade, while QVC in Japan remains relatively new.
“But it’s doing very well, and we are very successful in Japan,” said Geiger.
He added L’Occitane’s e-business is a small but growing percentage of the company’s overall sales. Its biggest market for the channel is the U.S., followed by Japan, which is catching up. “Obviously, we continue opening more stores,” continued Geiger, adding L’Occitane already has a very strong presence in emerging markets, including China — where it has 48 doors, Brazil, Russia and Mexico. “You can grow very much [there], and that is what we are doing,” he said.
The U.S. also holds “plenty of growth possibilities for us,” continued Geiger.
Geographically speaking, Japan is L’Occitane’s largest individual market in terms of revenues. Then come the U.S. and France. The latter generates less than 15 percent of total revenues for the company, while Asia rings up a bit under 50 percent.
Geiger didn’t nix the prospect of future acquisitions.
“It’s a possibility, but it is not very easy to find one,” he said. “We don’t want to buy a company just for the sake of growing. There are a few very interesting companies, but their owners don’t want to sell them.”
L’Occitane’s product line has about 500 units, with best sellers including the Shea Butter collection and Immortelle face care products.
L’Occitane was founded in 1976, and Geiger became a minority shareholder in the firm in 1994 before taking the company over in 1996.