L'Oreal loses its lustre as growth slows
Shares in L'Oreal, the world's largest cosmetics maker, fell in Paris trading after second-quarter sales growth missed estimates amid a slowing market. The shares slid as much as 3.3pc in morning trading, the steepest drop in France's benchmark CAC 40 Index.
Sales rose 5.2pc excluding acquisitions, disposals and currency shifts, Paris-based L'Oreal said yesterday after markets closed.
A slowdown in North American revenue growth to 4.5pc from 6.3pc in the previous quarter was the main concern of analysts. The deceleration in North America was "underwhelming" and a negative "surprise given the stronger economic consumer backdrop", said Alex Howson, an analyst at Jefferies International.
"There is clearly a bit less spend on the category and competition and promotion has been a bit harder."
Global beauty-market growth is slowing slightly to about 3.5pc, L'Oreal's financial communications director Thierry Prevot said. Still, the maker of Giorgio Armani fragrances and Maybelline make-up expects to outperform the industry and remains confident of another year of sales and profit growth, he said.