LâOreal reported a 3.5 percent rise in like-for-like first-quarter sales on Thursday, beating expectations for slower growth, as strong demand for its face creams and perfume in Europe helped counter challenging conditions in the United States.
The French cosmetics group, which owns Maybelline makeup and Kiehlâs skincare, reported sales of â¬11.7 billion ($13.3 billion) for the three months to the end of March.
Growth exceeded a Visible Alpha consensus of 1.3 percent cited by analysts at Jefferies, though also included a â¬100 million benefit from phasing of an IT overhaul, the company said.
LâOreal has outperformed the global cosmetics market in recent years with products that span its mass-market shampoos to high-end Valentino perfume and doctor-recommended Cerave lotions.
But growth had slowed over the last year as inflation-led price rises eased and competition heated up in China and the medical skincare category.
The US market was âmore challenging than anticipatedâ in the first quarter, said CEO Nicolas Hieronimus in a statement, adding, however, that China was slightly better than expected.
Luxury group LVMH said on Monday its beauty retailer Sephora had seen slower growth in the quarter in the US, hurt by cheaper offers on Amazon.
LâOreal is also exposed to a pullback in discretionary spending in economies hit by President Donald Trumpâs tariffs.
Hieronimus said LâOreal planned to âdrive growth and manage our P&L to offset the impact of tariff hikes â with the benefit of an already very healthy gross margin.”
He added that LâOreal would continue to outperform the global beauty market, which is still expected to grow despite the current economic and geopolitical tensions.
By Dominique Patton; Edited by Kirsten Donovan
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