Sales grew to €5.6bn for the quarter January to March, compared to the results for the corresponding quarter last year which were €5.1bn. The growth represented a like-for-like increase of 6.4 per cent.
The figures are the preliminary results, which means that profits will be announced towards the end of the month, but the sales figures beat a group of analysts surveyed by FactSet, who on average had expected the sales figure for the quarter to be €5.5bn.
Growth in all regions and all business divisions
L’Oreal CEO Jean-Paul Agon stressed the fact that the results represented sales growth in all four of the company’s principle business divisions as well as all geographic zones.
“The worldwide cosmetics market remains strong, and trends are favourable for all brands. L'Oreal Luxe is achieving remarkable growth, bolstered in particular by the dynamism of Lancome, the success of the designer fragrances, and the vitality of Kiehl's,” he said.
Last year L’Oreal was hard hit by the global downturn in its core markets, specifically the developed markets of Europe and North America. This makes the comparisons for the previous year favourable, but the current results show that these markets continue to struggle.
The strongest market was Asia, while North America displayed ‘sustained’ growth and in Western Europe the company improved its position in a relatively stagnant market. In Eastern Europe, the company said that new initiatives have shown dividends, following a slower performance in the corresponding quarter last year.
New markets lead the way
On a reported basis, the Western European market grew by 2.3 percent during the quarter to €1.95bn, while North America increased 13.1 per cent to €1.26bn, while the new markets of Asia Pacific, Eastern Europe, Latin America and Africa Middle East returned growth of 14.1 per cent to reach €2.1bn.
Of those new markets, the Asia Pacific region had by far the highest quarterly reported sales growth, at 22.6 per cent to €1.12bn, a result that was driven by particularly robust sales in both China and India.
Looking at the reported sales growth for the four core business divisions, Professional Products posted growth of 5.6 per cent growth, while Consumer Products grew 7.2 per cent, L’Oreal Luxe was up 17.8 per cent and Active Cosmetics grew by 5.3 per cent.
Looking ahead to the rest of the financial year, Agon said that following the first quarter results he was able to confirm his belief that the company will continue to outperform the market, despite the difficulties in the economic environment.