L’Oréal optimistic about 2010 despite 2009 sales dip
Beauty giant L’Oréal has reported sales of €17.5bn for 2009, a like for like drop of 1.1% on 2008. But the group says it is preparing for a return to growth in 2010 - as an encouraging fourth quarter like-for-like sales increase of 1.5% would indicate - and it has unveiled a threefold strategy to strengthen its business in the coming year.
Beauty giant L’Oréal has reported sales of €17.5bn for 2009, a like for like drop of 1.1% on 2008. But the group says it is preparing for a return to growth in 2010 - as an encouraging fourth quarter like-for-like sales increase of 1.5% would indicate - and it has unveiled a threefold strategy to strengthen its business in the coming year.
Although L’Oréal’s consumer products division fared well in 2009, growing 3.2% thanks to progress made by its Garnier and Maybelline brands, the group’s luxury products business slid 9%. According to L’Oréal this was partly influenced by the weakness of the fragrance market and the difficult situation of some western European markets. Business in France, Italy, and Spain suffered, contributing to a sales decline of 6.3% in western Europe, while Asia proved the most lucrative region with annual sales growth of 8.3% and fourth quarter sales up 12.6% on the same period of the prior year.
Ceo Jean-Paul Agon said that L’Oréal had “devoted the year to preparing for the future with three major strategic changes: the broadening of the consumer base with the target of winning a billion new consumers, a thorough transformation of the company to make it stronger and more flexible and finally a determined increase of investments in R&D and advertising & promotion to accelerate growth”.
“Overall,” he added, “L’Oréal has emerged from 2009 stronger and has prepared itself well for a return to sales and results growth in 2010.”