L’OREAL’S FIRST-HALF PROFITS SHOW GAIN OF 15.5 PERCENT
PARIS — French cosmetics giant L’Oreal reported Monday that 1997 consolidated first-half profits rose 15.5 percent to $589.2 million (3.56 billion francs) at current exchange rates.
L’Oreal said that over the year it hopes to achieve an increase in profit before tax, employee profit sharing and capital gains and losses at least equivalent to the first-half rise.
However, the company noted, the 1997 net profit, before capital gains and losses and after minority interests, will be affected by corporate tax measures recently announced by the French government. Additional tax costs for L’Oreal net of minority interests in Synthelabo is estimated at $16.5 million (100 million francs).
In an unrelated development, L’Oreal said it will acquire the remaining capital of the companies that market its products in Spain, pending the approval of the European Commission this month.
L’Oreal will purchase 51 percent of the capital of Procasa, which manufactures and markets products in L’Oreal’s consumer division and its salon division in Spain.
Procasa recorded sales last year of about $198.7 million (1.2 billion francs) and has been 49 percent-owned by L’Oreal since 1994.
L’Oreal will also acquire Cosesa, Cosmetique Active Iberica and Albesa, which market the group’s products in the perfumes, beauty and active cosmetics divisions in Spain. The three subsidiaries combined registered sales of about $132.5 million (800 million francs) in 1996.
L’Oreal declined to divulge the cost of the acquisition.