L’Oreal Reports Below-Forecast Sales and Profits in 2023

by webmaster

L’Oreal, the renowned French cosmetics company, fell short of analysts’ expectations for sales and profits in 2023. Despite facing challenges such as geopolitical tensions, inflation, and a sluggish beauty market in China, the company expressed confidence in outperforming the market this year.

Sales Performance

  • L’Oreal’s sales for 2023 reached €41.18 billion ($44.37 billion), representing a 7.6% increase in reported terms and an 11% increase on a like-for-like basis.
  • Sales in Europe demonstrated significant growth, rising 13.7% to €13.01 billion.
  • North America also performed well, with revenue increasing by 9.7% to €11.15 billion.
  • Latin America experienced a substantial jump of 22.8% in sales, reaching €2.92 billion.
  • However, revenue in North Asia witnessed a decline of 5.8% to €10.66 billion, primarily due to a softening market in mainland China.

Q4 Performance

  • In the fourth quarter of 2023, L’Oreal recorded sales of €10.61 billion, indicating a growth of 2.8% in reported terms and 6.9% on a like-for-like basis.

Profit Figures

  • L’Oreal’s annual net profit increased by 8.4% to reach €6.18 billion.
  • The operating profit, closely monitored by analysts and investors, grew by 9.2% to €8.14 billion.
  • At the upcoming annual general meeting on April 23, the company plans to propose a dividend of €6.60 per share, higher than the previous year’s payout of €6.00.

Analysts’ Expectations

  • According to consensus estimates by Visible Alpha, analysts had anticipated annual sales of €41.49 billion, with a net profit of €6.25 billion and an operating profit of €8.21 billion.

Outlook and Confidence

  • L’Oreal’s Chief Executive Nicolas Hieronimus expressed confidence in the company’s ability to achieve growth in sales and profits in the coming year. He stated, “As we head into 2024, we remain optimistic about the outlook for the beauty market, and confident in our ability to keep outperforming it.”

In summary, while L’Oreal faced some challenges in 2023, the company remains positive about the future and aims to deliver strong performance in 2024.

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