L'Oreal Earnings Rise on Growth Outside of China — Update

By David Sachs

L'Oreal's earnings rose in the second quarter, driven by growth outside of China.

On year, sales rose 5.3% on a like for like basis to 10.875 billion euros ($11.77 billion), the French cosmetics company said Tuesday after European markets closed.

Analysts expected sales of EUR10.78 billion, according to the Visible Alpha consensus.

Skin products drove growth, said the company behind Garnier and Lancome Paris. But the dermatological beauty category significantly missed expectations, RBC analysts said in a note.

Regionally, L'Oreal's emerging markets, Europe and North America drove growth, partially offsetting a decline in the Chinese market marked by soft consumer spending due to a sluggish economy.

The company posted a 2.4% decline in its North Asia region, including China. L'Oreal had aimed to reduce its reliance on the all-important market.

For the first half, L'Oreal's operating profit--a closely watched metric by analysts and traders--jumped 8% in the second quarter to EUR4.60 billion. Analysts expected operating profit at EUR4.57 billion, according to Visible Alpha. The operating margin hit 20.8% in the second half of last year.

The Paris-based company said it still aims to outperform the market this year.

Write to David Sachs at david.sachs@wsj.com

(END) Dow Jones Newswires

July 30, 2024 13:16 ET (17:16 GMT)

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