French beauty giant L’Oréal has reported a 4.3 percent rise in Q2 sales, which slightly fell short of expectations and was said to have been held back by a ‘very difficult market in France.’
The company’s North American sales growth was accelerated as expected, posting a recorded growth of 4.6 percent like for like, and is expected to outperform across the globe for 2016. Western Europe posted a 1.7 percent growth with NYX Professional Make up making a ‘promising start’.
The professional products sector posted like for like growth of 2.2 percent, driven by hair color with brands such as Matrix and Redken and the skincare brand Decléor in Europe, while consumer products posting a 4.7 percent rise.
L’Oréal Luxe saw a like for like growth of 5.6 percent with YSL continuing to have strong growth with good performances across China, Japan, North America and Eastern Europe. Meanwhile the active cosmetics division grew 5 percent, with La Roche-Posay continuing to post outstanding results.
Chairman and CEO Mr Jean-Paul Agon said in a statement, “Our results are of good quality, with a significant improvement in gross profit and sustained investments in both Research and Innovation and business drivers, supporting the Universalisation of our brands.
“The outstanding performances of our recent acquisitions, NYX Professional Makeup, Urban Decay and Niely, are making a very positive contribution to the Group’s growth. On the other hand, the results of Magic and Clarisonic were below our expectations, and have led us to record a goodwill impairment of 213 million and 234 million euros respectively on June 30, 2016. The impairment is a non-recurring charge and has no impact on the cash situation. The strategic relevance of these two brands remains unchanged.”