THE WHAT? L’Occitane has reported a 22.2 percent sales decline for the three months ending 30 June, with the company hit by retail closures during the ongoing COVID-19 pandemic.
THE DETAILS However, online soared 95.8 percent during the quarter, attributing to 52.6 percent of total sales. Meanwhile Asia outperformed for the beauty company, with China, Korea and Taiwan sales up 24.9%, 27.4% and 11.5% respectively.
Retail sales were hit hard in North America and the UK due to the Great Virus Crisis (GVC), falling 12.3 percent and 19.2 percent.
Elemis and LimeLIFE were said to have been adversely affected by travel bans and lockdowns, posting sales declines of around 25% to 35%. However, LimeLIFE reported strong growth of 51.6% at constant exchange rates due to healthy online sales, new product launches and initiatives.
Reinold Geiger, Chairman and CEO of L’Occitane, said, “Despite the difficult circumstances in the first quarter, there were several bright spots. The extraordinary growth in our online channels has gone a long way to cushion the impact that COVID-19 is having on our physical channels. The relative strength of our online channels is also reflected in the performance of LimeLife, which performed particularly well over the quarter. The like-for-like decline in ELEMIS sales was also nuanced, which bodes well for the brand’s recent launch in China.”
THE WHY? The results sing to the same tune as many companies across the beauty market, with most feeling the financial hit of mandatory COVID-19 store closures and travel bans. However, like others, the success of online sales have helped soften the blow to a certain extent, with L’Occitane doubling down on e-commerce efforts going forwards.
Geiger continued, “Meanwhile, there is a clear geographical separation in the performance of our business with markets in Asia recovering strongly. Although it is still too early to say whether this recovery will be emulated in Europe and the Americas as economies reopen, it is very encouraging to see the UK deliver 7.8% same store sales growth in FY2021 Q1. By prioritising an omni-channel approach and targeting investments on key markets and campaigns, we are well-positioned to emerge even stronger following the crisis.”