L'Oreal profits rise 21pc as sales make up lost ground in US, Europe
L'OREAL, the world's largest cosmetics maker, said yesterday first-half profit increased 21pc, helped by growth in Asia and Latin America and recovering sales of luxury fragrances.
Net income rose to €1.32bn from €1.09bn a year earlier, the Paris-based company said yesterday after markets closed. That equated to €2.26 a share but missed analysts' expectations of €1.37bn in income.
Profit is recovering after falling in each of the last two years as European and US consumers pared back spending and distributors ran down inventories.
"2010 should still be a bounce-back year for L'Oreal," analyst Andrew Wood said.
The profit improvement and control of selling, general and administrative expenses enabled increased investment in research and development and in advertising and promotion, chief executive Jean-Paul Agon said in the statement.
"We are tackling the second half with confidence and intend over the full year to keep on strengthening our worldwide positions and the profitability of our businesses," said Mr Agon.
First-half operating profit rose 21pc to €1.67bn. That beat the €1.6bn average analyst's estimate. Operating profit as a percentage of sales widened to 17.3pc from 15.7pc a year earlier.
L'Oreal rose 31c, or 0.4pc, to €75.77 in Paris trading. The stock has fallen 2.9pc this year. (Bloomberg)