PARIS — The beauty market is bouncing again worldwide, with estimated gross sales development of 11 p.c within the first half of 2021, versus the identical prior-year interval.
That’s in response to L’Oréal, which on Friday morning held a digital convention with monetary analysts and journalists to debate the group’s outcomes this 12 months.
For the primary time, the assembly was led by Nicolas Hieronimus, who turned L’Oréal’s chief govt officer on Might 1.
As reported, the maker of Lancôme, Kiehl’s and L’Oréal Paris merchandise on Thursday night reported it had returned to pre-pandemic development within the six months ended June, with an acceleration of 8.4 p.c within the second quarter in comparison with second-quarter 2019.
Within the April-to-June interval this 12 months, firm gross sales elevated 29.6 p.c in reported phrases to 7.58 billion euros. On a like-for-like foundation, gross sales rose 33.5 p.c, outpacing analysts’ expectations.
“We’re witnessing the restoration of the sweetness market to virtually pre-COVID-19 ranges,” mentioned Hieronimus, including the tempo of that continues to be contrasted, nonetheless.
By geographic zone, L’Oréal estimates the sweetness market within the first half rose about 16 p.c in North America, 14 p.c in North Asia, 9 p.c in each Latin America and the SAPMENA-SSA (or South Asia Pacific, Center East, North Africa and Sub-Saharan Africa) zone, and 5 p.c in Europe.
Within the first half, L’Oréal redefined its geographic zones.
“With development of 20 p.c, the Chinese language market is sizzling once more, with an ever-growing urge for food for magnificence, particularly luxurious,” mentioned Hieronimus. “On-line stays sturdy as extra platforms are getting into the sport, putting a brand new steadiness with the brick-and-mortar retail community, which is selecting up the O-plus-O — on-line plus offline — ecosystem now absolutely embraced by customers.”
He famous: “Within the USA, the market is recovering strongly, notably within the second quarter, with brick-and-mortar selecting up, whereas e-commerce continues exhibiting regular development versus 2019.”
L’Oréal estimates that market development within the U.S. throughout the first half stood at 17 p.c.
In the meantime, there was a slower bounce-back in Europe, with a 5 p.c gross sales improve, as a consequence of intermittent lockdowns.
“However it’s getting nearer to 2019, with the U.Ok. paving the best way to the full-speed restoration,” mentioned Hieronimus. “Generally, the market state of affairs is correlated to the sanitary state of affairs, and markets like South Asia, Japan and a few Latin America international locations are nonetheless extra unsure.”
The manager mentioned magnificence product classes, as nicely.
“The long-awaited rebound of the makeup class initiated in China is spreading within the U.S. and in Europe, though nonetheless beneath the 2019 ranges,” mentioned Hieronimus of the section, with gross sales rising an estimated 8 p.c within the half.
“Skincare continues to thrive, and hair merchandise are benefiting from the reopening of salons everywhere in the world and a rising curiosity for hair routines,” he continued, referring to the classes registering 13 p.c and eight p.c positive aspects, respectively.
Fragrance noticed the most important surge in gross sales development, posting a 24 p.c rise within the half.
By retail channel, e-commerce gross sales for magnificence had been up an estimated 24 p.c.
“E-commerce continues to develop, albeit at a slower tempo within the second half, going through final 12 months’s big acceleration and as distribution is being rebalanced by the opening of retail,” mentioned Hieronimus.
Concurrently, journey retail gross sales superior an estimated 17 p.c.
“Journey retail remains to be being fueled by the sturdy development of Hainan, the slight air-traffic rebound and the favorable comparatives in Europe,” he mentioned. “Nonetheless, it’s nonetheless very a lot beneath the 2019 ranges, as journey restrictions apply across the globe.
“Inside this context, L’Oréal delivered an distinctive outperformance at twice the market tempo and has returned to a pre-COVID-19 development rhythm,” mentioned Hieronimus of the group’s enterprise general. “With all divisions and areas profitable share with out exception, this has been an ideal Grand Slam for us.”
Hieronimus mentioned L’Oréal’s product divisions and geographic zones. Among the many callouts was the U.S. exercise.
“The nice information of the quarter is the comeback of L’Oréal USA,” he mentioned, explaining the nation’s gross sales strongly accelerated within the first six months, and particularly throughout the second quarter, when revenues grew 47 p.c.
“L’Oréal USA beat the market in all 4 divisions,” mentioned Hieronimus. “The rebalancing of classes, notably between skincare and makeup; of channels, between brick-and-mortar and e-commerce, and the success of a few of our launches and their digital activations are paying off and giving us confidence for the long run,” he continued.
Hieronimus mentioned the primary half was additionally distinctive for the corporate by way of revenue and earnings per share. Within the interval, working profitability was at 19.7 p.c of gross sales, and the EPS elevated 21.1 p.c at 4.63 euros.
“The sturdy set of outcomes come from the mixture of our sturdy top-line development, favorable class and channel combine results, and SG&A [or selling, general and administrative expenses], which have remained rigorously managed and contained by the absence of journey and occasions,” mentioned Hieronimus. “This distinctive alignment of planets has allowed us to take a position strongly in our manufacturers to bolster their desirability, whereas delivering strong revenue development. After this primary a part of the 12 months, we are able to say that L’Oréal has offset the enterprise losses of the COVID-19 disaster and returns to its cruising pace.
“Regardless of the uncertainties associated to the sanitary circumstances, we’re assured for the short- and long-term efficiency of the corporate,” he continued.
Hieronimus mentioned L’Oréal will leverage six dynamics, together with the market development, enterprise footprint, digital, give attention to innovation, manufacturers’ power and the group’s profit-and-loss mannequin.
“Within the second half, we might be evaluating to a constructive development in 2020, however our ambition is to proceed to speed up versus 2019,” mentioned Hieronimus. “We can even proceed to take a position strongly behind our manufacturers and launches, and hope to renew some touring and occasions in particular person.
“All in all, and pending the evolution of the pandemic, we’re assured in our potential to as soon as once more outperform the sweetness market and to ship one other 12 months of development in gross sales and income,” he mentioned.
For extra, see:
https://wwd.com/beauty-industry-news/beauty-features/beauty-sales-grew-around-11-worldwide-h1-1234891237/ | Magnificence Gross sales Grew Round 11% Worldwide in H1, Based on L’Oréal – WWD