L’Oreal 2021 sales reach record high as effects of COVID-19 wane

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L’Oreal SA sales reached a record high last year as the cosmetics company staged a full recovery following a lengthy COVID-related slowdown.

Sales for the year were 32.3 billion euros ($36.9 billion) in 2021, L’Oreal said in a statement Wednesday. Analysts had expected 31.9 billion euros. Operating profit for the period was nearly 6.2 billion euros, compared to the estimate of more than 6.1 billion euros.

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Shares in L’Oreal fell 1.55 percent in Paris trading Thursday.

L’Oreal’s sales were “brilliant,” said analysts at RBC but added that the French beauty products maker had slightly missed expectations on its margin.

The L’Oreal Luxe unit, which sells perfumes such as Libre by Yves Saint Laurent as well as premium skincare brands like Helena Rubinstein, became the group’s biggest unit, surpassing the consumer-products division, in signs of how the premium segment of that market has become even more important.

The beauty group grew at twice the rate of the broader market last year while posting market share gains in all regions, divisions and categories, the company said.

The results show how the reopening of economies across the world, enabled by vaccination programs gave consumers more opportunities to socialize and travel and bolstered cosmetics demand.

L’Oreal had the strongest growth rate in its active cosmetics unit in the fourth quarter, helped by demand for CeraVe and Vichy, brands that are sometimes recommended by dermatologists. Like-for-like sales in that division soared 24 percent. Analysts had expected a 25 percent jump.

“We see even more upside,” Deborah Aitken, analyst at Bloomberg Intelligence wrote in a note after the annual results, citing potential for a fuller recovery in makeup, haircare and travel retail notably.

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