L’Oréal Slows Down Due to Currency Impact, Posts 1.6% Growth Through June

L’Oréal drops down a gear in the first half of the year. The French cosmetics giant closed the January-June period this year with a turnover of €22,47 billion, up only 1.6% compared to the same period last year. In the second quarter, sales reached €10,73 billion, down 1.3%.

The impact of foreign exchange was significant in both periods, with like-for-like sales, i.e. at the same structure and discounting the effects of the exchange rate, developing positively: comparable sales rose by 3% in the first quarter and by 2.4% in the second quarter.

The rate of growth is in any case lower than in the previous year, when L’Oréal achieved growth of 5.6%, and also lower than in the first quarter, when, despite international uncertainty, sales rose by 4.4%.

L’Oréal’s comparable sales rose 3% in the first quarter and 2.4% in the second quarter

The company, which anticipated a negative impact of 3.7% on sales performance for the year as a whole due to currency fluctuations, highlighted the good performance of business in emerging markets and, in particular, in mainland China, which “is growing again”.

In Europe, the most important region for the group, L’Oréal achieved growth of 3.4% to 7,534 million euros, while in North America the rise was only 0.4% (2% like-for-like) to €5.82 billion. In North Asia, sales fell by 1.5% to €5.39 billion (down 1.1% like-for-like).

In the Sapena-SSA region, comprising the Middle East, Africa and South Asia Pacific, sales rose by 9.2% (up 1.2 points like-for-like) to 2,058 million. The performance was equally positive in Latin America, with like-for-like sales up 10.3%, although reported figures fell by 1%.

By division, sales growth was moderate in all of them: from 4.9% in professional products to 1.1% in consumer products, 1% in luxury and 1.7% in dermatological beauty products. On a like-for-like basis, the same growth rates were 6.5%, 2.8%, 2% and 3.1%, respectively.

The group’s operating margin remained stable, rising from 74.9% of sales in the first half of 2024 to 74.7% in the same period this year, while operating income was up 3.1% to €4.74 billion in the first half of the year. Net profit stood at €3,368 million, compared to €3,656 million in the same period of 2024. The group’s net debt stood at €4,006 million at June 30.