PARIS — L’Oréal’s sales advanced 4.4 percent in the fourth quarter of 2016, bolstered by the strong performance of its Luxe and Active Cosmetics divisions as well as its business in North America.
The world’s largest beauty company, which released numbers after the close of the bourse here on Thursday, posted revenues in the three months ended Dec. 31 of 6.79 billion euros, or $7.33 billion. On a like-for-like basis, the group’s sales advanced 4.8 percent.
The results were above analysts’ consensus estimate of 4.1 percent reported sales growth.
For 2016 as a whole, L’Oréal’s sales grew 2.3 percent to 25.84 billion euros, or $28.6 billion. The company’s net profit excluding non-recurring items after non-controlling interests grew 4.5 percent to 3.65 billion, or $4.04 billion, while its operating profit advanced 3.5 percent to 4.54 billion euros, or $5.03 billion.
Broken down by division for the quarter, Consumer Products, L’Oréal’s largest activity, saw sales up 3.3 percent to 3 billion euros, or $3.24 billion; L’Oréal Luxe’s sales advanced 8.4 percent, to 2.21 billion euros, or $2.38 billion, while Professional Products revenues grew 2.2 percent to 866.8 million euros, or $935.2 million. The Active Cosmetics division’s sales climbed 6.5 percent to 413.6 million euros, or $446.2 million, while The Body Shop, which is rumored to be up for sale, saw a 6.3 percent decline in its reported sales, to 321.3 million euros, or $346.7 million.
In North America, the group saw a sales gain 10.4 percent, to 1.88 billion euros, or $2.03 billion, while revenues in Western Europe increased 1.7 percent to 2.03 billion euros, or $2.19 billion. In New Markets, sales increased 4.1 percent to 2.56 billion euros, or $2.76 billion, with strong performances in Eastern Europe and Latin America and low single-digit gains in Asia-Pacific and the Middle East and Africa.
“L’Oréal achieved another good year, with a significant growth in sales and robust profits,” said Jean-Paul Agon, chairman and chief executive officer of L’Oréal.
“All the divisions recorded sales growth, especially L’Oréal Luxe, which is significantly strengthening its positions. The Active Cosmetics division also performed well, winning market share around the world,” Agon continued. “The Consumer Products division, driven by its successful strategic choices, saw a clear acceleration in sales and outperformed its market.”
The L’Oréal Luxe division saw its sales advance 6 percent to 7.66 billion euros, or $8.48 billion, thanks in part to strong gains from Yves Saint Laurent makeup and fragrance. The brand’s sales topped the 1 billion euro, or $1.11 billion, mark for the first time, L’Oréal said. The division was also boosted by the acquisitions of Atelier Cologne and IT Cosmetics.
Sales for the Consumer Products division grew 1.3 percent to 12 billion euros, or $13.28 billion, thanks to double-digit growth in makeup with NYX, as well as Maybelline, L’Oréal Paris and Essie. The division performed particularly well in North America, L’Oréal observed.
For Active Cosmetics, all geographic zones contributed to year-on-year growth of 2.4 percent to 1.86 billion euros, or $2.06 billion. Professional Products sales were flat on a reported basis, at 3.4 billion euros, or $3.76 billion, in a market the company described as “gradually improving.”
For The Body Shop, which has reportedly been on the block, full-year sales fell 4.8 percent to 920.8 million euros, or $1.02 billion. L’Oréal said the brand had seen good momentum in Europe, especially the U.K., and in Latin America, but had witnessed a difficult context in Saudi Arabia and Hong Kong, which had impacted its overall performance.
All dollar figures are converted at average exchange for the period to which they refer.