L'Oréal reports balanced growth between physical shops and e-commerce this semester
L'Oréal achieved sales growth of 13.3% in the first half of 2023. The European region recorded growth of 18.2%, with the group significantly accelerating its online sales since the second quarter.
The L'Oréal group has published its results for the first half of 2023. Sales are up 13.3% on the first half of 2022.
Group sales at 30 June 2023 had already reached €20.57 billion, up 12.0% on last year. Gross margin stood at 15.28 billion euros, or 74.3% of sales, a positive development since this margin was 73.1% of sales in the first half of 2022. Thanks to the success of our innovations and the desirability of our brands, we are continuing to grow in terms of both volume and value," comments Nicolas Hieronimus, Chief Executive Officer of L'Oréal. Our virtuous operating account has enabled us to improve our profitability while increasing investment in our brands. At the same time, true to our dual commitment to excellence, we are continuing to invest in our transformation towards a more sustainable business model that creates value over the long term.
Research and innovation costs represented 3% of sales, amounting to €622.8 million. Advertising and promotion costs amounted to 6.68 billion euros, or 32.5% of sales. Selling, general and administrative expenses stabilised at 18.1% of sales, down 20 points in the first half of 2022. Overall, operating income rose by 13.7% to €4.25 billion in the first half of 2023, and represented 20.7% of sales, an increase of 30 basis points compared with the first half of 2022.
Profits driven by professional, consumer, luxury, and dermatological products
Sales of professional products posted sustained growth of 7.6% compared with the first half of 2022. The division performed particularly well in mainland China and India, as well as in the United Kingdom. It continued to grow across all its distribution channels: in salons, through its SalonCentric network (in North America), and online. This growth was driven by the Kérastase brand and by L'Oréal Professionnel. In haircolour, sales of products for professionals also rose, driven by the Shades EQ range from Redken and the Inoa range from L'Oréal Professionnel.
Sales of products for the general public also stood out, with growth of 15%, representing an increase in sales of almost a billion euros over the first half. The make-up category is particularly dynamic, with the recent launch of Maybelline New York's Falsies Surreal mascara, L'Oréal Paris' Telescopic Lift mascara, and NYX Professional Makeup's Fat Oil gloss.
L'Oréal Luxe is also accelerating quarter on quarter, with growth of 7.6% driven by double-digit gains in Europe, North America, and emerging markets. Here, the fragrance category was buoyed by the performance of couture brands such as Yves Saint Laurent, Prada, and Valentino. In skincare, L'Oréal Luxe continues to grow thanks to the spectacular success of Helena Rubinstein, the takeover of Lancôme in North America, and the success of Takami in Japan and more recently in mainland China.
Finally, the dermatological beauty division recorded spectacular growth of 29%, with La Roche-Posay the number one contributor to the division's growth. Sales growth of CeraVe products also remained dynamic in North America, and accelerated sharply in the rest of the world. Vichy, meanwhile, was buoyed by the success of Dercos, as well as by good momentum in the suncare segment.