L'Oréal: News release: "2022 Half-Year Results"
NEWS
RELEASE
Clichy,
28 July 2022 at 6.00
p.m.
2022
Half-Year Results
Exceptional
performance:+13.5%
like-for-like 1, +20.9%
reported
Strong increase in profits
- Sales: 18.36
billion euros
- +13.5% like-for-like 1
- +13.9% at constant exchange rates
- +20.9% based on reported figures
- Double-digit growth in
selective Divisions, significant acceleration
in Consumer Products
- Double-digit growth in all
Zones, very strong growth in emerging
markets
- Operating margin at
20.4%, an increase
of 70 basis points
- Strong growth in
EPS 2:
+30.8% at
€6.05
Commenting on the figures, Nicolas Hieronimus, CEO of L'Oréal,
said:
“L'Oréal performed remarkably well in the first
half of the year, with growth of +13.5% like-for-like and +20.9%
reported.
After two years of the pandemic, consumers
confirm their desire to socialise and indulge themselves with
innovative and superior beauty products, which in turn is fueling
the growth of the beauty market. L’Oréal grew twice as fast as the
market and has strengthened its position as the world’s No.1 beauty
company.
Our performance is increasingly balanced.
Balanced between volume and value growth. Balanced between offline
growth, with the reopening of retail outlets in most countries, and
e-commerce 3 growth which continues at a double-digit pace.
Balanced between geographic Zones, all of which posted double-digit
growth, with strong performance in emerging markets (SAPMENA–SSA 4,
Latin America) and outstanding performance in mainland China in a
very challenging context, thanks to our expertise in e-commerce.
Balanced across our Divisions, with our three selective Divisions
achieving double-digit growth and the Consumer Products Division
recording a significant acceleration in the second quarter. Lastly,
every major category achieved double-digit growth.
Our proven capacity to valorise our portfolio
through innovation and control our costs allowed us to absorb the
impact of higher raw material prices, mitigate supply chain
pressures, and continue to invest efficiently in our brands, while
improving profitability and creating sustainable value.
Our L’Oréal for the Future programme reached an
important milestone: after the United-States in 2021, we achieved
carbon neutrality across all our sites in the North Asia Zone. In
addition, the success of our third employee share ownership plan,
rolled out in more than 60 countries, demonstrates the strong
commitment of our employees worldwide.
Mindful of the current uncertainties and
instability, we are convinced that our unique, balanced model, our
incredible innovation capacity, our strong brand portfolio, the
passion and agility of our teams and our financial strength are the
assets that will enable us to pursue our profitable and sustainable
growth strategy.
We remain optimistic about the outlook for the
global beauty market and confident in our ability to outperform in
2022 and achieve another year of growth in sales and
profits.”
Moreover, the Board of Directors has decided,
under the authorisation voted by the Annual General Meeting of 21
April 2022, to set up a share buyback programme during the second
half of 2022 amounting to a maximum of 500 million euros and with a
maximum number of shares to be acquired of 2 million. The shares
thus repurchased are intended to be cancelled 5.
2022
HALF-YEAR SALES
Like-for-like, i.e. based on a
comparable scope of consolidation and constant exchange rates,
sales of the L’Oréal group grew by +13.5%.
The net impact of changes in the scope
of consolidation was +0.4%.
Growth at constant
exchange rates came out at +13.9%.
Currency
fluctuations had a positive impact of
+7.0%. If the exchange rates at 30 June 2022, i.e. €1 =
$1.042, are extrapolated until 31 December, the impact of currency
fluctuations on sales would be around +6.9% for the whole of
2022.
Based on reported figures, the
Group’s sales at 30 June 2022 amounted to 18.36 billion euros, an
increase of +20.9%.
Sales by Division and Geographic Zone
|
2nd quarter
2022 |
1st half
2022 |
|
|
Growth |
|
Growth |
|
€m |
Like-for-like |
Reported |
€m |
Like-for-like |
Reported |
By Division |
|
|
|
|
|
|
Professional Products |
1,122.6 |
+11.3% |
+20.7% |
2,163.8 |
+14.3% |
+21.7% |
Consumer Products |
3,491.5 |
+9.1% |
+16.8% |
6,794.3 |
+8.0% |
+13.9% |
L’Oréal Luxe |
3,407.9 |
+15.3% |
+26.1% |
6,871.6 |
+16.4% |
+25.6% |
Active Cosmetics |
1,283.9 |
+23.8% |
+33.9% |
2,536.6 |
+20.9% |
+28.0% |
|
|
|
|
|
|
|
Group Total |
9,305.8 |
+13.4% |
+22.7% |
18,366.3 |
+13.5% |
+20.9% |
By geographic
Zone |
|
|
|
|
|
|
Europe |
2,712.7 |
+12.0% |
+13.4% |
5,567.2 |
+14.3% |
+14.6% |
North America |
2,446.5 |
+10.7% |
+25.3% |
4,650.4 |
+11.6% |
+23.5% |
North Asia |
2,818.3 |
+11.7% |
+22.7% |
5,620.1 |
+10.5% |
+20.3% |
SAPMENA–SSA 6 |
722.3 |
+30.8% |
+38.9% |
1,403.4 |
+23.0% |
+28.3% |
Latin America |
606.0 |
+22.4% |
+43.9% |
1,125.3 |
+22.3% |
+39.1% |
|
|
|
|
|
|
|
Group Total |
9,305.8 |
+13.4% |
+22.7% |
18,366.3 |
+13.5% |
+20.9% |
The Asian Travel Retail business unit was
relocated on 1st July 2022, which generated anticipated invoicing
of €90 million in June. This had a positive impact of 110 basis
points on second quarter like-for-like growth, and 60 basis points
on the first half. This impact will be reversed in the third
quarter 2022.
Summary by Division
PROFESSIONAL
PRODUCTS
At the end of
June, the Professional
Products Division recorded strong
growth at
+14.3%
like-for-like and
+21.7%
reported. The Division continued to grow strongly in all
geographic Zones, with outstanding performance in India, mainland
China, North America and Germany. This growth confirms the success
of the Division’s omnichannel strategy, with a significant increase
in sales in e-commerce, in salons, and within the SalonCentric
distribution network in the United States.The Division increased
its leadership in the dynamic haircare market, thanks in particular
to the good performance of Kérastase and Serie Expert by
L’Oréal Professionnel. In hair colour, the Division also recorded
strong growth, with the success of its iconic lines: Shades
EQ by Redken and Inoa by L’Oréal Professionnel;
innovation continued with Redken Color Gels Lacquers 10 Min, which
allows hairdressers to cover 100% of white hair in 10
minutes.Always at the cutting edge, the Division expanded its
service offering by launching L’Oréal’s first marketplace for
beauty professionals through the SalonCentric distribution network
in the United States, thus reaffirming its global leadership.
CONSUMER PRODUCTS
The Consumer Products Division
posted solid
growth in the first
half:
+8.0%
like-for-like and
+13.9%
reported, with an outstanding second
quarter at +9.1%This performance was driven by the success
of all its major brands and their product innovations. In a dynamic
global makeup market, the Division progressed even faster, thanks
to the performance of NYX Professional Makeup and blockbuster
launches like True Match serum by L'Oréal Paris and Vinyl Ink
lipstick by Maybelline New York. The Division also recorded
double-digit growth in haircare, with the global rollout of Elvive
Hyaluron Plump as well as a successful focus on premium ranges. In
skincare, Garnier continued to grow in the different Zones, with
the success of its Vitamin C Brightening Serum and micellar waters.
In mainland China, the lockdown in Shanghai curbed product
deliveries early in the second quarter. In June, L’Oréal Paris
ranked No.1 beauty brand in the 6.18 Shopping Festival on Tmall.
Elsewhere, the Division gained significant market share in the
United States, accelerated in Europe and recorded outstanding
performance in emerging markets, especially Mexico, Brazil, India
and the Middle East.Thanks to its advanced revenue growth
management, the Division was able to create growth in both volume
and value, while preserving its profitability.
L’ORÉAL LUXE
In the first half of the year, L'Oréal
Luxe recorded
very strong growth
of +16.4% like-for-like and +25.6%
reported, again
outperforming the
global luxury beauty
market.The Division outperformed in all
three of its categories. The super-premium brands Lancôme Absolue
and Helena Rubinstein drove the growth in skincare along with the
newly acquired brands Takami and Youth to the People. In
fragrances, the Division grew by +35%; global mainstays such as
Libre by Yves Saint Laurent and Born in Roma by Valentino were
powerful growth drivers. Driven by the success of Maison Margiela
and Armani Privé, the Collections segment is booming and showing
strong potential. In makeup, the global brands Lancôme and
Yves Saint Laurent and the category specialists Shu Uemura and
Urban Decay grew significantly faster than the market, which
continued to be dynamic.The Division’s performance is balanced
across geographic Zones. L’Oréal Luxe accelerated strongly in
SAPMENA-SSA and Latin America and reached very high market share
levels in North Asia. Despite a difficult context in mainland
China, L'Oréal Luxe achieved exceptional performance and reached a
record market share there.
ACTIVE
COSMETICS
At the end of June, the Division posted
very strong growth of
+20.9%
like-for-like and
+28.0%
reported.Building on a strengthened partnership with
healthcare professionals, which is boosting the Division’s
recommendation-based model, the Active Cosmetics Division grew much
faster than the dermocosmetics market. The Division achieved
double-digit growth in all Zones, with remarkable performance in
North America, Europe and SAPMENA–SSA.Growth is balanced between
e-commerce and brick-and-mortar, which maintained a good momentum
over the half-year with a strong contribution from the drugstore
and pharmacy channels.La Roche-Posay, the primary contributor to
the Division’s growth, accelerated strongly, driven by Cicaplast
and Effaclar, as well as the success of the patented sun protection
innovation UVMune 400, the result of 10 years of
research. CeraVe remained the Division’s fastest growing
brand, continuing to perform remarkably well in North America while
pursuing its dynamic expansion in international markets.
Vichy posted double-digit growth driven by the relaunch of
Neovadiol, the success of the innovative UV AGE in a very dynamic
sun protection market, and of the Dercos franchise in haircare.
Skinceuticalsaccelerated in the second quarter, fuelled by the
excellent performance of A.G.E Interrupter anti-wrinkle cream.
Summary by
geographic Zone
EUROPE
The Zone achieved
strong growth of
+14.3%
like-for-like and
+14.6%
reported.With the lifting of public health
restrictions in the majority of countries, the European beauty
market was dynamic in the first half and has now exceeded 2019
levels. All categories grew, and L’Oréal outperformed the market in
the majority of countries, particularly Spain-Portugal, Germany and
Italy. L’Oréal continued to strengthen its positions in
e-commerce.The Active Cosmetics Division significantly increased
its market share, with La Roche-Posay posting very strong growth
and CeraVe expanding rapidly. Reinforcing its leadership, L’Oréal
Luxe recorded outstanding performance in fragrances, despite supply
chain constraints. The performance of the Consumer Products
Division was driven by makeup and skincare. The Professional
Products Division reported balanced growth between hair colour and
haircare. The Group's activities in Ukraine, which were put on hold
on 24 February following the invasion, were resumed in a
limited capacity in response to customer demand. In Russia, the
Group has temporarily closed all its own stores and e-commerce
sites and suspended all industrial and media investments. In
accordance with European and American sanctions, it has suspended
the sales of all products except essential daily products.
NORTH
AMERICA
In the first half of the year, the Zone
grew by +11.6% like-for-like and +23.5%
reported.Sales continued to grow amid a robust market that
has returned to pre-Covid levels. As brick-and-mortar recovers,
growth is balanced between online and offline. Product innovations,
dedication to service improvement and a major focus on valorisation
across all Divisions were key to L’Oréal’s success in the first
half. Despite real improvements, supply chain pressures persisted
in a context of strong growth.The Consumer Products Division
continued to grow with innovations in all categories, led by NYX
Professional Makeup, which successfully completed its
transformation. The performance of L’Oréal Luxe was driven by
fragrances, while the recently acquired brand Youth to the People
bolstered the Division’s skincare range. The Professional Products
Division also beat the market, driven by SalonCentric and the
recovery of salons, as well as its strong innovation strategy. The
Active Cosmetics Division significantly outpaced the market, with
La Roche-Posay and CeraVe achieving very strong growth.
NORTH ASIA
The Zone recorded
growth of +10.5%
like-for-like and +20.3%
reported.Amid the Covid-19 resurgence in the Zone, L'Oréal
achieved exceptional performance, with all three selective
Divisions posting double-digit growth. L'Oréal Luxe recorded
spectacular market share gains, with the activations of Lancôme,
Helena Rubinstein and Yves Saint Laurent, and also the successful
rollout of Urban Decay and Maison Margiela while the Active
Cosmetics and Professional Products Divisions were driven by the
success of La Roche-Posay, Skinceuticals and Kérastase. The
Consumer Products Division improved in the second quarter thanks to
strong innovation initiatives from Maybelline New York and L’Oréal
Paris. In mainland China, the beauty market contracted
significantly at the beginning of the second quarter due to the
lockdown. Thanks to its robust supply infrastructure, L’Oréal was
able to cope with disruptions and achieved solid performance, with
double-digit growth in June, reinforcing its market share in all
Divisions during the second quarter, with L’Oréal Luxe reaching a
historic market share. The Group leveraged its excellence in
e-commerce and six of its brands featured in the top 12 during the
Tmall 6.18 Shopping Festival: L'Oréal Paris ranked No.1 in total
beauty and in skincare in particular; Kérastase was ranked No.1 in
haircare, while Stylenanda 3CE topped the makeup ranking. L'Oréal
Paris also topped the rankings in the new platform created by
ByteDance (TikTok/Douyin).In the rest of the Zone, L’Oréal
outperformed the market in South Korea, and, in Japan, the recently
acquired Takami brand is growing very fast.
SAPMENA–SSA 7
The Zone grew
sharply by
+23.0%
like-for-like and
+28.3%
reported.In SAPMENA, L’Oréal grew much faster than the
market. The Group met booming demand from brick-and-mortar outlets
in the Zone, while continuing to grow online, with a strong
activation strategy. The performance in SAPMENA was largely driven
by the outstanding sales dynamic in India. In the Pacific region,
L’Oréal confirmed its recovery in Australia with double-digit
growth in the second quarter. In South-East Asia, the gradual
return of tourist footfall has contributed to the recovery of sales
in the region; L’Oréal saw a dramatic recovery in offline sales in
Malaysia and continued to grow in Thailand and Vietnam thanks to
the success of the Active Cosmetics Division. In the Middle East,
the Gulf states saw spectacular sales growth. In Sub-Saharan Africa
(SSA), the Group progressed much faster than the market and
achieved an outstanding performance, driven by South Africa and
Kenya.
LATIN
AMERICAThe
Zone recorded an
excellent performance, with growth of
+22.3% like-for-like and
+39.1% based on reported
figures.
The beauty market continued to expand in all
countries, with particularly strong growth in Mexico and an
acceleration in Brazil and Chile. In this context, L’Oréal gained
market share, driven by the outstanding performance of the Consumer
Products Division. L’Oréal recorded double-digit growth in all
Divisions and all countries, with a significant acceleration in
Mexico and the remarkable growth of the Consumer Products Division
in Brazil. All categories posted strong growth. The weight of
online sales continued to increase, and L’Oréal recorded strong
growth in brick-and-mortar.
IMPORTANT EVENTS DURING THE
PERIOD
1/4/22
TO
30/6/22 AND
POST-CLOSING EVENTS
- On 21 April,
L’Oréal announced the launch of a Circular Innovation
Fund to scale breakthrough circular innovative solutions
from around the world. As an anchor investor, L’Oréal is
contributing 50 million euros to this new 150 million euros fund.
The investment is part of its L’Oréal for the Future sustainability
programme.
- On 17 May, L’Oréal
announced the launch of its third Employee Share Ownership
Plan. The plan was successfully rolled out in more than 60
countries and gives L’Oréal employees, in France and
internationally, the possibility to be even more closely linked to
the Group’s development.
- On 20 May,
L’Oréal’s corporate venture capital fund BOLD (Business
Opportunities for L’Oréal Development) announced a minority
investment in SPARTY, Inc., a Japanese startup dedicated
to personalised beauty. This investment marks the first venture
capital investment by L’Oréal in Japan.
- On 24 May, after 10
years of research, L’Oréal introduced UVMune 400,
its first sun filtering technology to effectively protect the skin
against ultra-long UVA rays, which are the most insidious. With
this major scientific breakthrough, L’Oréal is helping to prevent
sun-induced deep skin damage, which is a major public health
issue.
- On 25 May, L’Oréal
announced the launch of the L’Oréal BOLD Female
Founders initiative designed to support female-led
startups. It will be developed by its venture capital fund BOLD
(Business Opportunities for L’Oréal Development) with a
dedicated initial allocation of 25 million euros.
- From 15 to
18 June, at Viva Technology 2022 in Paris,
L’Oréal unveiled its vision for the Future of Beauty with an
exploration of Web3 and the metaverse, alongside
immersive beauty experiences such as Scent-Sation
by Yves Saint Laurent Beauté, in partnership with EMOTIV, to help
consumers navigate the world of fragrance; or L’Oréal Water Saver,
named one of TIME magazine’s 100 Best Inventions of 2021, a
groundbreaking showerhead that uses rocket engine technology to
create a luxurious and efficient hair washing experience while
reducing water consumption by 61% compared to standard
methods.
- On 23 June, the
Fondation L’Oréal and UNESCO celebrated 45 eminent women scientists
from over 35 countries at the For Women in Science
International Awards ceremony, a showcase of
female scientific excellence. Fifteen STEM researchers received the
Award in recognition of their outstanding scientific achievements,
along with 30 young female scientists who earned the title of
International Rising Talents.
- 24 June marked
the 30th anniversary of L’Oréal Brandstorm, the
innovation competition for students from all over the world, this
year organised in partnership with Salesforce.
- On 28 June, at the
award ceremony for the Young Shareholders Golden
Palms, created by EDHEC Business School and the Federation
of Individual Investors and Investment Clubs (F2iC), L’Oréal
received the “Palme de la Pédagogie”. This award recognises the
company that has made the most effort to inform and communicate
with its shareholders.
- On 5 July,
L'Oréal was granted the Award for ESG Purpose and
Commitments at the 2022 General Meeting and Gender Balance
Awards ceremony, organised by the Institut du Capitalisme
Responsable.
- On 22 July,
L’Oréal announced that all its sites in the North Asia Zone
have achieved carbon neutrality (scopes 1 & 2), by
using exclusively renewable energy. This result illustrates the
Group’s efforts to fight climate change and is an important step
towards achieving the objectives of the L’Oréal for the Future
programme.
2022 HALF-YEAR RESULTS
The limited review procedures of the half-year consolidated
accounts have been completed. The limited review report is being
prepared by the Statutory Auditors.
Operating profitability at
20.4% of sales
Consolidated profit and loss account: from sales
to operating profit.
€m |
30/6/21 |
% of sales |
31/12/21 |
% of sales |
30/6/22 |
% of sales |
ChangeH1-2022
vs. H1-2021 |
Sales |
15,196.6 |
100.0% |
32,287.6 |
100.0% |
18,366.3 |
100.0% |
+20.9% |
Cost of sales |
-3,869.5 |
25.5% |
-8,433.3 |
26.1% |
-4,935.8 |
-26.9% |
|
Gross profit |
11,327.1 |
74.5% |
23,854.3 |
73.9% |
13,430.6 |
73.1% |
+18.6% |
R&I expenses |
-489.1 |
3.2% |
-1,028.7 |
3.2% |
-539.6 |
2.9% |
|
Advertising and promotion expenses |
-4,951.6 |
32.6% |
-10,591.0 |
32.8% |
-5,793.3 |
31.5% |
|
Selling, general and administrative expenses |
-2,898.2 |
19.1% |
-6,074.2 |
18.8% |
-3,352.2 |
18.3% |
|
Operating profit |
2,988.1 |
19.7% |
6,160.3 |
19.1% |
3,745.5 |
20.4% |
+25.3% |
Gross profit, at 13,430.6
million euros, came out at 73.1% of sales compared with 74.5%, a
difference of 140 basis points compared with the first half of
2021.
Research &
Innovation expenses, at 539.6 million euros, came
out at 2.9% of sales.
Advertising and promotion
expenses came out at 31.5% of sales, a decrease of 110
basis points.
Selling, general and administrative
expenses, at 18.3% of sales, decreased by 80 basis
points.
Overall, operating profit
increased by +25.3% to 3,745.5 million euros and amounted to 20.4%
of sales, an increase of 70 basis points compared with the first
half of 2021.
Operating profit by
Division
|
30/6/21 |
31/12/21 |
30/6/22 |
|
€m |
% of sales |
€m |
% of sales |
€m |
% of sales |
By Division |
|
|
|
|
|
|
Professional Products |
363.9 |
20.5% |
806.9 |
21.3% |
458.7 |
21.2% |
Consumer Products |
1,193.4 |
20.0% |
2,466.0 |
20.2% |
1,359.8 |
20.0% |
L’Oréal Luxe |
1,301.9 |
23.8% |
2,816.3 |
22.8% |
1,647.8 |
24.0% |
Active Cosmetics |
570.0 |
28.8% |
990.5 |
25.2% |
703.5 |
27.7% |
Total Divisionsbefore
non-allocated |
3,429.1 |
22.6% |
7,079.7 |
21.9% |
4,169.9 |
22.7% |
Non-allocated8 |
-441.0 |
-2.9% |
-919.4 |
-2.8% |
-424.4 |
-2.3% |
Group |
2,988.1 |
19.7% |
6,160.3 |
19.1% |
3,745.5 |
20.4% |
The L’Oréal group is managed on an annual basis.
This means that half-year operating profits cannot be extrapolated
for the whole year.
The profitability of the Professional
Products Division increased from 20.5% to 21.2%.
The profitability of the Consumer
Products Division came out at 20.0%, as in the first half
of 2021.
The profitability of L’Oréal
Luxe improved by 20 basis points to 24.0%.
The profitability of the Active
Cosmetics Division decreased by 110 basis points, to
27.7%.
Net profit excluding non-recurring
items
Consolidated profit and loss account: from
operating profit to net profit excluding non-recurring items.
€m |
30/6/21 |
31/12/21 |
30/06/22 |
ChangeH1-2022
vs. H1-2021 |
Operating profit |
2,988.1 |
6,160.3 |
3,745.5 |
+25.3% |
Financial revenues and expenses, excluding Sanofi dividends |
-29.4 |
-59.6 |
-16.4 |
|
Sanofi dividends |
378.3 |
378.3 |
468.2 |
|
Profit before tax and associatesexcluding non-recurring items |
3,337.0 |
6,478.9 |
4,197.3 |
|
Income tax excluding non-recurring items |
-731.9 |
-1,535.6 |
-943.0 |
|
Net profit excluding non-recurring items of equity consolidated
companies |
+0.3 |
+0.6 |
+1.1 |
|
Non-controlling interests |
-5.4 |
-5.5 |
-1.3 |
|
Net profit excluding non-recurring items,
after non-controlling interests
9 |
2,600.0 |
4,938.5 |
3,254.0 |
+25,2% |
EPS 10 (€) |
4.63 |
8.82 |
6.05 |
+30,8% |
Diluted average number of shares |
561,833,554 |
559,791,545 |
537,541,538 |
|
Overall financial expenses came
out at 16.4 million euros.
Sanofi dividends amounted to
468.2 million euros. This year, in addition to the annual dividend
of 393.7 million euros, Sanofi paid an additional dividend-in-kind
in the form of newly listed Euroapi shares for an amount of
74.5 million euros.
Income tax excluding non-recurring
items came out at 943.0 million euros, i.e. a tax rate of
22.5%, higher than the first half of 2021.
Net profit excluding non-recurring items
after non-controlling interests came out at 3,254.0
million euros.
Earnings per share, at 6.05
euros, increased by +30.8% compared with the first half of
2021.
Net profit
Consolidated profit and loss account: from net profit excluding
non-recurring items to net profit.
€m |
30/6/21 |
31/12/21 |
30/6/22 |
Net profit excluding non-recurring items,
after non-controlling interests
9 |
2,600.0 |
4,938.5 |
3,254.0 |
Non-recurring items |
-237.4 |
-341.4 |
-31.2 |
of which: |
|
|
|
- other income and expenses
|
-315.3 |
-432.0 |
-34.5 |
|
+77.9 |
+90.6 |
+3.3 |
|
|
|
|
Net profit after non-controlling interests |
2,362.6 |
4,597.1 |
3,222.8 |
Non-recurring items amounted to 31.2 million euros net of
tax.
Operating cash flow and balance
sheet
Gross cash flow amounted to
3,825.1 million euros, an increase of 14.7%.
The change in working capital
amounted to -1,849 million euros.
Investments,
at 638.3 million euros, represented 3.5% of sales.
Operating cash flow
11 amounted to 1,337.0 million euros, a decrease
of 37.5%.
At 30 June 2022, after taking into account
finance lease liabilities for 1,649 million euros,
net debt amounted to 5,007
million euros.
“This news release does not constitute an offer
to sell, or a solicitation of an offer to buy L’Oréal shares. If
you wish to obtain more comprehensive information about L’Oréal,
please refer to the public documents registered in France with the
Autorité des Marchés Financiers, also available in English on our
Internet site www.loreal-finance.com.
This news release may contain some
forward-looking statements. Although the Company considers that
these statements are based on reasonable hypotheses at the date of
publication of this release, they are by their nature subject to
risks and uncertainties which could cause actual results to differ
materially from those indicated or projected in these
statements.”
This is a free translation into English of the
2022 Half-Year Results news release issued in the French language
and is provided solely for the convenience of English-speaking
readers. In case of discrepancy, the French version prevails.
About
L’Oréal
For over 100 years, L’Oréal the world’s leading
beauty player, has devoted itself to one thing only: fulfilling the
beauty aspirations of consumers around the world. Our purpose
- to create the beauty that moves the world - defines our approach
to beauty as inclusive, ethical, generous and committed to social
and environmental sustainability. With our broad portfolio of
35 international brands and ambitious sustainability commitments in
our L’Oréal For The Future programme, we offer each and every
person around the world the best in terms of quality, efficacy,
safety, sincerity and responsibility, while celebrating beauty in
its infinite plurality.
With 85,400 committed employees, a balanced
geographical footprint and sales across all distribution networks
(e-commerce, mass market, department stores, pharmacies, hair
salons, branded and travel retail) in 2021 the Group generated
sales amounting to 32.28 billion euros. With 20 research
centers across 11 countries around the world, a dedicated Research
and Innovation team of 4,000 scientists and over 3,000 tech
professionals, L’Oréal is focused on inventing the future of beauty
and becoming a Beauty Tech powerhouse.
More information
on https://www.loreal.com/en/mediaroom
L’ORÉAL
CONTACTS
Switchboard+33
(0) 1 47 56 70 00 |
Individual
Shareholders and
Market
Authorities Mr. Christian
Munich+33 (0)1 47 56 72 06christian.munich2@loreal.com |
Investor
relations Ms. Françoise Lauvin+33 (0)1 47 56 86
82francoise.lauvin@loreal.com |
Journalists Ms. Noëlle Camilleri+33 (0)6 79
92 99 39noelle.camilleri@loreal.com |
|
For more information. please contact your bank.
broker or financial institution (I.S.I.N. code: FR0000120321). and
consult your usual newspapers. the Internet site for shareholders
and investors. www.loreal-finance.com or the L’Oréal Finance app.
alternatively. call +33 1 40 14 80 50.
This press release has been secured and authenticated with the
blockchain technology. You can verify its authenticity on the
website www.wiztrust.com
Appendix
Appendix 1: L’Oréal group
sales
2021/2022
(€ million)
|
2021 |
2022 |
First quarter |
7,614.5 |
9,060.5 |
Second quarter |
7,582.1 |
9,305.8 |
First half total |
15,196.6 |
18,366.3 |
Third quarter |
7,996.6 |
|
Nine months total |
23,193.1 |
|
Fourth quarter |
9,094.4 |
|
Full year total |
32,287.6 |
|
Appendix 2: Compared consolidated income
statements
€ millions |
1st half
2022 |
1st half
2021 |
2021 |
Net sales |
18,366.3 |
15,196.6 |
32,287.6 |
Cost of sales |
-4,935.8 |
-3,869.5 |
-8,433.3 |
Gross profit |
13,430.6 |
11,327.1 |
23,854.3 |
Research & innovation expenses |
-539.6 |
-489.1 |
-1,028.7 |
Advertising and promotion expenses |
-5,793.3 |
-4,951.6 |
-10,591.0 |
Selling, general and administrative expenses |
-3,352.2 |
-2,898.2 |
-6,074.2 |
Operating profit |
3,745.5 |
2,988.1 |
6,160.3 |
Other income and expenses |
-34.5 |
-315.3 |
-432.0 |
Operational profit |
3,711.0 |
2,672.8 |
5,728.3 |
Finance costs on gross debt |
-14.0 |
-22.5 |
-38.0 |
Finance income on cash and cash equivalents |
29.0 |
12.4 |
18.5 |
Finance costs, net |
15.0 |
-10.1 |
-19.4 |
Other financial income and expenses |
-31.4 |
-19.2 |
-40.2 |
Sanofi dividends |
468.2 |
378.3 |
378.3 |
Profit before tax and associates |
4,162.8 |
3,021.7 |
6,046.9 |
Income tax |
-940.0 |
-654.0 |
-1,445.4 |
Share of profit in associates |
1.1 |
0.3 |
0.6 |
Net profit |
3,224.0 |
2,368.0 |
4,602.2 |
Attributable to: |
|
|
|
|
3,222.8 |
2,362.6 |
4,597.1 |
- non-controlling interests
|
1.2 |
5.4 |
5.1 |
Earnings per share attributable to owners of the company
(euros) |
6.02 |
4.22 |
8.24 |
Diluted earnings per share attributable to owners of the company
(euros) |
6.00 |
4.21 |
8.21 |
Earnings per share attributable to owners of the company, excluding
non-recurring items (euros) |
6.07 |
4.65 |
8.86 |
Diluted earnings per share attributable to owners of the company,
excluding non-recurring items (euros) |
6.05 |
4.63 |
8.82 |
Appendix 3: Consolidated statement of
comprehensive income
€ millions |
1st half
2022 |
1st half
2021 |
2021 |
Consolidated net profit for the period |
3,224.0 |
2,368.0 |
4,602.2 |
Cash flow hedges |
-38.0 |
-155.6 |
-203.7 |
Cumulative translation adjustments |
680.9 |
281.5 |
610.5 |
Income tax on items that may be reclassified to profit or loss
(1) |
6.9 |
31.8 |
41.5 |
Items that may be reclassified to profit or
loss |
649.8 |
157.7 |
448.3 |
Financial assets at fair value through other comprehensive
income |
913.2 |
1,151.6 |
1,192.2 |
Actuarial gains and losses |
342.1 |
386.2 |
585.5 |
Income tax on items that may not be reclassified to profit or loss
(1) |
-116.9 |
-130.1 |
-181.7 |
Items that may not be reclassified to profit or
loss |
1,138.4 |
1,407.6 |
1,596.0 |
Other comprehensive income |
1,788.2 |
1,565.3 |
2,044.3 |
Consolidated comprehensive income |
5,012.2 |
3,933.3 |
6,646.5 |
Attributable to: |
|
|
|
|
5,010.8 |
3,927.9 |
6,641.4 |
- non-controlling interests
|
1.4 |
5.4 |
5.1 |
(1) The tax effect is as follows:
€ millions |
1st half
2022 |
1st half
2021 |
2021 |
Cash flow hedges |
6.9 |
31.8 |
41.5 |
Items that may be reclassified to profit or
loss |
6.9 |
31.8 |
41.5 |
Financial assets at fair value through other comprehensive
income |
-28.5 |
-36.9 |
-37.3 |
Actuarial gains and losses |
-88.4 |
-93.3 |
-144.4 |
Items that may not be reclassified to profit or
loss |
-116.9 |
-130.1 |
-181.7 |
TOTAL |
-110.0 |
-98.3 |
-140.2 |
Appendix 4: Compared consolidated balance
sheets
▌ Assets
€ millions |
30.06.2022 |
30.06.2021 |
31.12.2021 |
Non-current assets |
32,578.9 |
30,192.7 |
30,937.6 |
Goodwill |
11,353.9 |
10,559.0 |
11,074.5 |
Other intangible assets |
3,501.0 |
3,455.0 |
3,462.8 |
Right-of-use assets |
1,491.8 |
1,414.3 |
1,507.6 |
Property, plant and equipment |
3,441.0 |
3,182.9 |
3,266.2 |
Non-current financial assets |
11,956.5 |
10,786.5 |
10,920.2 |
Investments accounted for the equity method |
10.9 |
10.5 |
9.9 |
Deferred tax assets |
823.8 |
784.5 |
696.5 |
Current assets |
14,590.0 |
13,762.9 |
12,075.8 |
Inventories |
3,988.3 |
2,948.2 |
3,166.9 |
Trade accounts receivable |
5,064.6 |
3,991.8 |
4,021.0 |
Other current assets |
2,399.6 |
1,869.4 |
2,037.9 |
Current tax assets |
150.3 |
129.3 |
136.2 |
Cash and cash equivalents |
2,987.4 |
4,824.3 |
2,713.8 |
TOTAL |
47,168.9 |
43,955.6 |
43,013.4 |
▌ Equity &
Liabilities
€ millions |
30.06.2022 |
30.06.2021 |
31.12.2021 |
Equity |
25,932.4 |
29,636.8 |
23,592.6 |
Share capital |
107.3 |
112.1 |
111.5 |
Additional paid-in capital |
3,265.6 |
3,265.6 |
3,265.6 |
Other reserves |
12,085.9 |
18,909.3 |
19,092.2 |
Other comprehensive income |
6,845.8 |
5,588.5 |
5,738.6 |
Cumulative translation adjustments |
401.7 |
-607.9 |
-279.1 |
Treasury shares |
— |
— |
-8,940.2 |
Net profit attributable to owners of the company |
3,222.8 |
2,362.6 |
4,597.1 |
Equity attributable to owners of the company |
25,929.1 |
29,630.2 |
23,585.7 |
Non-controlling interests |
3.3 |
6.6 |
6.9 |
Non-current liabilities |
5,527.3 |
2,987.6 |
2,837.6 |
Provisions for employee retirement obligations and related
benefits |
62.1 |
650.0 |
360.6 |
Provisions for liabilities and charges |
61.9 |
57.9 |
63.8 |
Non-current tax liabilities |
290.9 |
364.2 |
344.8 |
Deferred tax liabilities |
896.5 |
710.0 |
810.3 |
Non-current borrowings and debt |
3,009.4 |
8.9 |
10.7 |
Non-current lease debt |
1,206.5 |
1,196.5 |
1,247.5 |
Current liabilities |
15,709.2 |
11,331.3 |
16,583.2 |
Trade accounts payable |
6,467.6 |
5,386.3 |
6,068.1 |
Provisions for liabilities and charges |
1,245.0 |
1,211.1 |
1,223.3 |
Other current liabilities |
3,821.1 |
3,263.5 |
3,980.8 |
Income tax |
396.1 |
224.3 |
268.9 |
Current borrowings and debt |
3,336.4 |
863.6 |
4,619.4 |
Current lease debt |
443.0 |
382.5 |
422.8 |
TOTAL |
47,168.9 |
43,955.6 |
43,013.4 |
Appendix 5: Consolidated statements of
changes in equity
€ millions |
Common shares outstanding |
Share capital |
Additional paid-in capital |
Retained earnings and net profit |
Other comprehensive income |
Treasury shares |
Cumulative translation adjustments |
Equity attributable to owners of the company |
Non-controlling interests |
Equity |
AT 31.12.2020 |
559,871,580 |
112.0 |
3,259.8 |
22,206.0 |
4,304.5 |
— |
-889.1 |
28,993.0 |
5.8 |
28,998.8 |
Consolidated net profit for the period |
|
|
|
4,597.1 |
|
|
|
4,597.1 |
5.1 |
4,602.2 |
Cash flow hedges |
|
|
|
|
-161.9 |
|
|
-161.9 |
-0.3 |
-162.2 |
Cumulative translation adjustments |
|
|
|
|
|
|
582.4 |
582.4 |
0.3 |
582.7 |
Hyperinflation |
|
|
|
|
|
|
27.8 |
27.8 |
— |
27.8 |
Other comprehensive income that may be reclassified to
profit and loss |
|
|
|
|
-161.9 |
|
610.2 |
448.3 |
— |
448.3 |
Financial assets at fair value through other comprehensive
income |
|
|
|
|
1,154.9 |
|
|
1,154.9 |
|
1,154.9 |
Actuarial gains and losses |
|
|
|
|
441.1 |
|
|
441.1 |
|
441.1 |
Other comprehensive income that may not be reclassified to
profit and loss |
|
|
|
|
1,596.0 |
|
— |
1,596.0 |
— |
1,596.0 |
Consolidated comprehensive income |
|
|
|
4,597.1 |
1,434.1 |
|
610.2 |
6,641.4 |
5.1 |
6,646.5 |
Capital increase |
800,780 |
— |
5.8 |
— |
— |
|
— |
5.8 |
— |
5.8 |
Cancellation of Treasury shares |
|
-0.5 |
|
-1,104.3 |
— |
1,104.8 |
— |
— |
— |
— |
Dividends paid (not paid on Treasury shares) |
|
|
|
-2,264.4 |
— |
|
— |
-2,264.4 |
-4.7 |
-2,269.1 |
Share-based payment |
|
|
|
155.2 |
— |
|
— |
155.2 |
— |
155.2 |
Net changes in Treasury shares |
-25,260,000 |
|
|
— |
— |
|
-10,045.0 |
-10,045.0 |
— |
-10,045.0 |
Changes in scope of consolidation |
|
|
|
— |
— |
|
— |
— |
— |
— |
Other movements (2) |
|
|
|
99.8 |
— |
|
— |
99.8 |
0.6 |
100.4 |
At 31.12.2021 |
535,412,360 |
111.5 |
3,265.6 |
23,689.3 |
5,738.6 |
-8,940.2 |
-279.1 |
23,585.7 |
6.9 |
23,592.6 |
Impact of the application of the IFRIC decision on SaaS
contracts |
|
|
|
-152.5 |
|
|
|
-152.5 |
|
-152.5 |
At 01.01.2022
(1) |
535,412,360 |
111.5 |
3,265.6 |
23,536.8 |
5,738.6 |
-8,940.2 |
-279.1 |
23,433.2 |
6.9 |
23,440.1 |
Consolidated net profit for the period |
|
|
|
3,222.8 |
|
|
|
3,222.8 |
1.2 |
3,224.0 |
Cash flow hedges |
|
|
|
|
-31.2 |
|
|
-31.2 |
0.1 |
-31.1 |
Cumulative translation adjustments |
|
|
|
|
|
|
648.1 |
648.1 |
0.1 |
648.2 |
Hyperinflation |
|
|
|
|
|
|
32.7 |
32.7 |
|
32.7 |
Other comprehensive income that may be reclassified to
profit and loss |
|
|
|
|
-31.2 |
|
680.8 |
649.6 |
0.2 |
649.8 |
Financial assets at fair value through other comprehensive
income |
|
|
|
|
884.7 |
|
|
884.7 |
|
884.7 |
Actuarial gains and losses |
|
|
|
|
253.7 |
|
|
253.7 |
|
253.7 |
Other comprehensive income that may not be reclassified to
profit and loss |
|
|
|
|
1,138.4 |
|
— |
1,138.4 |
— |
1,138.4 |
Consolidated comprehensive income |
|
|
|
3,222.8 |
1,107.2 |
— |
680.8 |
5,010.8 |
1.4 |
5,012.2 |
Capital increase |
868,249 |
0.2 |
|
-0.2 |
|
|
|
— |
|
— |
Cancellation of Treasury shares |
|
-4.5 |
|
-8,935.8 |
|
8,940.2 |
|
— |
|
— |
Dividends paid (not paid on Treasury shares) |
|
|
|
-2,601.2 |
|
|
|
-2,601.2 |
-4.4 |
-2,605.6 |
Share-based payment |
|
|
|
86.8 |
|
|
|
86.8 |
|
86.8 |
Net changes in Treasury shares |
|
|
|
|
|
|
|
— |
|
— |
Changes in scope of consolidation |
|
|
|
|
|
|
|
— |
|
— |
Other movements |
|
|
|
-0.6 |
|
|
|
-0.6 |
-0.5 |
-1.1 |
AT
30.06.2022 |
536,280,609 |
107.3 |
3,265.6 |
15,308.6 |
6,845.8 |
— |
401.7 |
25,929.1 |
3.3 |
25,932.4 |
(1) After taking account of the IFRIC final decision in
April 2021 on setup and customization costs for SaaS-type contracts
software.(2) Of which €102.2 million pertaining to the IFRIC
2021 interpretation on IAS19 "Employee Benefits" on Attributing
Benefit to Periods of Service”.
▌ Changes in first-half
2021
€ millions |
Common shares outstanding |
Share capital |
Additional paid-in capital |
Retained earnings and
net profit |
Othercomprehensive
income |
Treasury shares |
Cumulative translation adjustments |
Equity attributableto
owners of the
company |
Non-controlling
interests |
Equity |
At 31.12.2020 |
559,871,580 |
112.0 |
3,259.8 |
22,206.0 |
4,304.5 |
— |
-889.1 |
28,993.0 |
5.8 |
28,998.8 |
Consolidated net profit for the period |
|
|
|
2,362.6 |
|
|
|
2,362.6 |
5.4 |
2,368.0 |
Cash flow hedges |
|
|
|
|
-123.6 |
|
|
-123.6 |
-0.2 |
-123.8 |
Cumulative translation adjustments |
|
|
|
|
|
|
266.8 |
266.8 |
0.2 |
267.0 |
Hyperinflation |
|
|
|
|
|
|
14.5 |
14.5 |
|
14.5 |
Other comprehensive income that may be reclassified to
profit and loss |
|
|
|
|
-123.6 |
|
281.3 |
157.7 |
— |
157.7 |
Financial assets at fair value through other comprehensive
income |
|
|
|
|
1,114.7 |
|
|
1,114.7 |
|
1,114.7 |
Actuarial gains and losses |
|
|
|
|
292.9 |
|
|
292.9 |
|
292.9 |
Other comprehensive income that may not be reclassified to
profit and loss |
|
|
|
|
1,407.6 |
|
— |
1,407.6 |
— |
1,407.6 |
Consolidated comprehensive income |
|
|
|
2,362.6 |
1,284.0 |
— |
281.3 |
3,927.9 |
5.4 |
3,933.3 |
Capital increase |
800,168 |
0.2 |
5.8 |
-0.2 |
|
|
|
5.8 |
|
5.8 |
Cancellation of Treasury shares |
|
|
|
|
|
|
|
— |
|
— |
Dividends paid (not paid on Treasury shares) |
|
|
|
-2,264.4 |
|
|
|
-2,264.4 |
-4.7 |
-2,269.1 |
Share-based payment |
|
|
|
75.9 |
|
|
|
75.9 |
|
75.9 |
Net changes in Treasury shares |
-3,000,000 |
|
|
|
|
-1,104.8 |
|
-1,104.8 |
|
-1,104.8 |
Changes in scope of consolidation |
|
|
|
|
|
|
|
— |
|
— |
Other movements |
|
|
|
-3.2 |
|
|
|
-3.2 |
0.1 |
-3.1 |
AT 30.06.2021 |
557,671,748 |
112.1 |
3,265.6 |
22,376.7 |
5,588.5 |
-1,104.8 |
-607.9 |
29,630.2 |
6.6 |
29,636.8 |
Appendix 6: Compared consolidated
statements of cash flows
€ millions |
1st half
2022 |
1st half
2021 |
2021 |
Cash flows from operating activities |
|
|
|
Net profit attributable to owners of the company |
3,222.8 |
2,362.6 |
4,597.1 |
Non-controlling interests |
1.2 |
5.4 |
5.1 |
Elimination of expenses and income with no impact on cash
flows: |
|
|
|
• depreciation, amortisation, provisions and non-current tax
liabilities |
626.8 |
910.3 |
1,781.0 |
• changes in deferred taxes |
-57.3 |
-28.3 |
83.6 |
• share-based payment (including free shares) |
86.8 |
75.9 |
155.2 |
• capital gains and losses on disposals of assets |
-0.5 |
1.4 |
0.5 |
Other non-cash transactions |
-53.6 |
8.1 |
16.5 |
Share of profit in associates net of dividends received |
-1.1 |
0.6 |
1.3 |
Gross cash flow |
3,825.1 |
3,336.1 |
6,640.4 |
Changes in working capital |
-1,849.8 |
-675.1 |
88.0 |
Net cash provided by operating activities (A) |
1,975.4 |
2,661.0 |
6,728.4 |
Cash flows from investing activities |
|
|
|
Purchases of property, plant and equipment and intangible
assets |
-638.3 |
-523.1 |
-1,075.2 |
Disposals of property, plant and equipment and intangible
assets |
3.6 |
12.5 |
14.5 |
Changes in other financial assets (including investments in
non-consolidated companies) |
-54.2 |
-23.9 |
-117.3 |
Effect of changes in the scope of consolidation |
-10.2 |
-161.3 |
-455.7 |
Net cash from investing activities (B) |
-699.1 |
-695.8 |
-1,633.7 |
Cash flows from financing activities |
|
|
|
Dividends paid |
-2,641.2 |
-2,322.0 |
-2,352.1 |
Capital increase of the parent company |
— |
5.8 |
5.8 |
Disposal (acquisition) of Treasury shares |
— |
-1,104.8 |
-10,060.9 |
Purchase of non-controlling interests |
— |
— |
— |
Issuance (repayment) of short-term loans |
-1,216.6 |
26.5 |
3,939.4 |
Issuance of long-term borrowings |
2,997.8 |
— |
— |
Repayment of long-term borrowings |
— |
— |
— |
Repayment of lease debt |
-216.7 |
-200.9 |
-396.4 |
Net cash from financing activities (C) |
-1,076.7 |
-3,595.3 |
-8,864.2 |
Net effect of changes in exchange rates and fair value (D) |
73.9 |
48.5 |
77.4 |
Change in cash and cash equivalents (A+B+C+D) |
273.5 |
-1,581.6 |
-3,692.1 |
Cash and cash equivalents at beginning of the period
(E) |
2,713.8 |
6,405.9 |
6,405.9 |
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD
(A+B+C+D+E) |
2,987.4 |
4,824.3 |
2,713.8 |
1 Like-for-like: based on a comparable structure
and identical exchange rates.2 Diluted earnings per share,
excluding non-recurring items, after non-controlling interests.3
Sales achieved on our brands’ websites and with e-commerce pure
players + estimated sales achieved by our brands corresponding to
sales through our retailers’ websites (non-audited data).4
SAPMENA–SSA: South Asia Pacific, Middle East, North Africa,
Sub-Saharan Africa
5 The L'Oréal Universal Registration Document
filed with the AMF (Autorité des Marchés Financiers) on 17 March
2022 includes, on page 416, the other pieces of information that
must appear in the share buyback programme description pursuant to
Article 241-2 of the General Regulation of the AMF.6 SAPMENA–SSA:
South Asia Pacific, Middle East, North Africa, Sub-Saharan
Africa 7 SAPMENA – SSA: South Asia Pacific, Middle East, North
Africa, Sub-Saharan Africa
8 Non-allocated expenses = Central Group
expenses, fundamental research expenses, stock options and free
grant of shares expenses and miscellaneous items. 9 Net profit
excluding non-recurring items, after non-controlling interests,
excludes mostly capital gains and losses on disposals of long-term
assets, impairment of assets, restructuring costs, tax effects and
non-controlling interests.10 Diluted net profit per share,
excluding non-recurring items, after non-controlling interests.11
Operating cash flow = Gross cash flow + changes in working capital
- capital expenditure.
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