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L'Oreal's Sales, Profit Miss Expectations on Stagnating Chinese Beauty Market — Update

By Mauro Orru


L'Oreal posted sales and profits below analysts' forecasts for 2023, a year marked by geopolitical tensions, inflation and a stagnating beauty market in China. But the company said it is confident it would outperform the market this year.

The French cosmetics company on Thursday posted sales of 41.18 billion euros ($44.37 billion) for the year, up 7.6% in reported terms and 11% on a like-for-like basis.

Sales in Europe climbed 13.7% in reported terms to EUR13.01 billion thanks to what L'Oreal said was a very dynamic beauty market, making the region the single-largest growth driver for the second year running.

In North America,where each division grew led by dermatological beauty and L'Oreal Luxe, revenue increased 9.7% to EUR11.15 billion. The group said the CeraVe and La Roche Posay skin care brands had propelled sales at its dermatological beauty division, while L'Oreal Luxe outperformed the market in fragrances with Born in Roma by Valentino and MYSLF by Yves Saint Laurent.

Sales in Latin America jumped 22.8% to EUR2.92 billion. However, revenue in North Asia slumped 5.8% to EUR10.66 billion because of market softness in mainland China.

In the fourth quarter, global sales rose 2.8% in reported terms and 6.9% on a like-for-like basis to EUR10.61 billion.

L'Oreal's annual net profit increased 8.4% to EUR6.18 billion, while operating profit -- closely watched by analysts and investors -- grew 9.2% to EUR8.14 billion. The group said it would propose a dividend of EUR6.60 per share at its annual general meeting on April 23, up from EUR6.00 it paid for the previous year.

Analysts had forecast annual sales of EUR41.49 billion on a net profit of EUR6.25 billion and operating profit of EUR8.21 billion, according to consensus estimates by Visible Alpha.

"As we head into 2024, we remain optimistic about the outlook for the beauty market, and confident in our ability to keep outperforming it and to achieve another year of growth in sales and profits," said Chief Executive Nicolas Hieronimus.


Write to Mauro Orru at


(END) Dow Jones Newswires

February 08, 2024 13:30 ET (18:30 GMT)

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