Luxury brand manufacturer L’Oreal has posted lower-than-expected sales figures for its third quarter with falling demand for its luxury products, but said its year-to-date growth was strong.
Sales rose 10.1 per cent to €5.94 billion for the three months to September 30 - an increase of 3.7 per cent on an organic basis.
Sales of cosmetics were up 10.1 per cent to €5.73 billion - an increase of 3.8 per cent at an organic level.
In Western Europe, sales rose 4.4 per cent to €1.9 billion - up 2.5 per cent on an organic basis.
Meanwhile, sales jumped 22.5 per cent to €1.6 billion - an 3.8 per cent increase on an organic basis - in North America with the strong dollar.
L'Oreal reported organic growth of 9.4 per cent in Eastern Europe.
The Body Shop posted a sales rise of 11.6 per cent to €212.5 million - up +0.5 per cent on an organic basis.
Commenting on the figures, Jean-Paul Agon, chairman and CEO of L'Oréal, said, "At the end of September, the Group’s reported growth is strong, at +13.2 per cent, still supported by a very positive currency effect. In the third quarter, the Consumer Products Division is confirming the gradual strengthening of its growth, notably through strong momentum in make-up with its three brands: Maybelline, L'Oréal Paris and NYX."
The Active Cosmetics Division continues to "forge ahead" and the Professional Products Division keeps "outperforming" a lacklustre market, he added.
"L’Oréal Luxe experienced a temporary slowdown as a result of market turbulence over the summer in Asia, in Hong Kong and in travel retail."
By geographic zone, North America’s growth is gradually increasing and Western Europe confirms its positive trend, he said. In the third quarter, the new markets were hampered by the difficult Brazilian market, market turbulence in Asia and the taking over of agents’ contracts in the Middle East. In China, sales growth was in line with earlier quarters.
"Despite a global context that is still volatile, we are confident for the year end. The beauty market remains dynamic. In each division, our brands are pushing forward with successes such as Maybelline and NYX in the Consumer Products Division, Yves Saint Laurent, Kiehl's and Urban Decay at L’Oréal Luxe, Redken in the Professional Products Division and La Roche-Posay at Active Cosmetics. We are confirming our ambition to outperform once again the beauty market in 2015 and to achieve significant growth in both sales and profits."
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