L’Oreal has reported an ‘exceptional’ first half of the year, increasing sales by 20.7% compared to the same period in 2020.
The company generated sales of €15.19 billion and reported growth of 33.5% in the second quarter.
Commenting on the figures, Nicolas Hieronimus, L’Oreal’s CEO, said: “With the health situation still uncertain, the beauty market is gradually recovering and has recorded double-digit growth.
“As a result of the determination and continued commitment of our teams, that I wish to warmly thank, L’Oreal is significantly outperforming the market, with an exceptional second quarter.
“By the end of June, the group posted a very strong increase and returned to its pre-COVID growth rate, up 6.6% like-for-like compared to the first half of 2019, with an acceleration of 8.4% in Q2 compared to 2019.”
L’Oreal recorded market share gains in all divisions and geographic zones. The Professional Products Division recorded ‘very strong growth’ at 41% like-for-like and 32.6% reported, strengthening its leadership in the market which is gradually recovering from the pandemic.
The Professional Products Division benefits from three underlying trends in the sector: the digitalisation of salons, the development of freelance stylists and the explosion of e-commerce. All geographic zones saw sales growth in this division, with record performance in the US.
The division also confirmed its success in mainland China with ‘very strong’ growth in e-commerce and salons. It continued its growth trend in Europe, driven by Germany and France. Haircare remains the number one category for growth, led by a ‘particularly dynamic’ Kerastase (including hair styling products, such as aerosol hair sprays) the successful launch of Curl Manifesto, and the success of Genesis, as well as good performance from Metal Detox by L’Oreal Professionnel and Acidic Bonding Concentrate by Redken.
“This remarkable performance reflects the relevance and healthy balance of our multi-faceted model in terms of geographic footprint, brands, and categories,” commented Hieronimus.
“The Professional Products division has successfully transformed its business model and achieved record performance. The Consumer Products division recorded double-digit growth in the second quarter, thanks in particular to the recovery of makeup.
“L’Oreal Luxe also saw a sharp rise in fragrance sales and significantly outperformed the market. The Active Cosmetics Division achieved record growth, demonstrating that its brand portfolio is perfectly adapted to consumers’ health and beauty aspirations.
“Our geographic zones have now been redefined around more homogenous consumption areas. All achieved double-digit growth. North Asia continued to perform well, still driven by mainland China where L’Oreal continues to strengthen its undisputed leadership, while North America saw a return to growth with a tremendous acceleration in the second quarter.
“In Europe, L’Oreal significantly outperformed the market, which is starting to recover gradually. All countries in this zone are growing, led by the UK, France, and Russia. The group performed well in South Asia Pacific – Middle East – North Africa (SAPMENA-SSA) and in Latin America, with a marked progression in Brazil.”
Hieronimus said L’Oreal’s first-half results are evidence of its ‘virtuous circle’: a strong improvement in gross margin, combined with good cost control, which enabled it to invest significantly in developing brands and delivering an increase in profitability.
“L’Oreal has again gained strength in the early part of the year and is well-positioned to continue to grow at its pre-crisis pace, leveraging on technology, data, and artificial intelligence to become the beauty tech company,” added Hieronimus.
“In the second half of 2021, we will pursue our offensive product launch strategy while at the same time investing in relevant growth drivers to spur the future growth and desirability of our brands.
“We are more confident than ever in our ability to outperform the market and achieve a year of growth in both sales and results.”