L'Oreal Reviewing Options for The Body Shop--Update
10 February 2017 - 5:48AM
Dow Jones News
By Nick Kostov
PARIS -- French cosmetics giant L'Oréal SA on Thursday confirmed
that it is considering selling The Body Shop, which has been its
worst-performing business in recent years.
"We have decided with the board that it was time to explore all
type of options regarding The Body Shop ownership," L'Oréal CEO
Jean-Paul Agon said in an interview. "Despite all our efforts, we
have been pretty disappointed by the results for the last two or
three years, both in terms of sales and profitability."
Sales at The Body Shop, the global chain that pioneered the sale
of natural beauty-care products, have slumped in recent years in
comparison to L'Oreal's other businesses. A sale would come some 11
years after the French cosmetics giant bought the chain for GBP652
million as a way to tap into growing demand for natural
cosmetics.
L'Oréal, home to brands including Lancôme, Garnier and Kiehl's,
disclosed the strategic review as it reported fourth-quarter sales
in line with the expectation of analysts.
The company reported that revenue at its mass consumer-goods
business rose 4.2% on a like-for-like basis in the three months to
Dec. 31, lifted by booming makeup sales. Sales growth at L'Oréal
Luxe -- which includes brands such as Ralph Lauren and Giorgio
Armani -- was 7.1% in the period as a result of the company's Yves
Saint Laurent brand breaking the EUR1 billion mark.
Mr. Agon didn't give a precise forecast for the full year other
than to express confidence in the company's ability to outperform
the market again and achieve growth in sales and profit.
Net profit dropped to EUR3.11 billion in 2016 from EUR3.3
billion the previous year because of two impairment charges in the
first half of the year. Sales for the full year rose 2.3% to
EUR25.84 billion.
Write to Nick Kostov at Nick.Kostov@wsj.com
(END) Dow Jones Newswires
February 09, 2017 13:33 ET (18:33 GMT)
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