Cosmetics group L’Oreal bucked a declining trend for the luxury and fashion industry in China with sales growing in the second quarter despite Covid-19 lockdowns, as the make-up market rebounds.
The group said on Thursday overall sales for the three months to June came in at US$9.46bn, an increase of 13.4 per cent on a like-for-like basis. The figure beat analyst expectations for an 8.9 per cent rise in revenues, according to a Visible Alpha consensus cited by UBS.
The news comes just a few days after the cosmetics giant said it would close its Maybelline stores in Mainland China due to falling sales.
“Make-up is really bouncing back,” L’Oreal CEO Nicolas Hieronimus told Reuters in an interview, as post-pandemic socialising accelerates and people go out to parties and events.
The executive, who estimates the global cosmetics market is growing at six per cent, noted a return of lip glosses and “a lot of colour,” which he attributed to people emerging from two “very difficult years.”
In China, where many Western labels have seen a drop in sales since mid-March due to store closures and restrictions on movement, L’Oreal grew revenues by 13 per cent over the quarter, outpacing a decline of around 6 per cent in the market, thanks to a lift from e-commerce sales, Hieronimus said.
