L'Oréal sales soar 8% in Q1
C&T giant announces sales of €4.7bn led by a resurge in demand for its luxury products
L'Oréal's sales in first quarter 2010 rose 8% to €4.7bn with growth in its luxury products division, led by the Lancôme and Helena Rubinstein ranges, increasing by 11.8%, professional hairdressing product sales rising by 5.8% and mass market products led by L'Oréal Phare up by 6.9%. Sales have benefited from the strong growth in new markets, around 14.8%, notably Latin America. West European sales in contrast put on 2.8% while US sales rose by 5.8% in the reported quarter.
Director general Jean-Paul Agon said consumption was now rising and consumers had not changed their habits during the economic crisis to the extent imagined by some commentators. The immediate aim of the group was, he said, to increase the number of consumers of group products by 1 billion over the next ten years. Agon also said that after cutting some 65,000 jobs in 2009 and freezing recruitment, L'Oréal would now end the freeze on new jobs.
The company is seen to have gained from its strategy of internationalisation with the new markets of Asia, Africa and Latin America accounting for 35% of sales in first quarter compared with 42% for the lead market of western Europe. Agon noted the return to growth in the USA and some signs of recovery in western Europe. World market growth was now estimated at between 5% and 6% for the current year.
The director general said that the aim in the USA would be to develop the main ranges of Lancôme, Kiehl's, Armani, Ralph Lauren and Yves Saint Laurent, adding that in a highly competitive market making money was not easy. Demand has remained strong in the new markets. Meanwhile, there are no plans to close any plants or sites in 2010 and L'Oréal said it sees the first quarter as the start of a new phase of expansion.