Chinese demand for skincare products boosts sales of French cosmetics company L’Oreal
- The French maker of Maybelline and Urban Decay has thrived on strong demand from Chinese shoppers in recent years, especially for its higher-end products
Strong Chinese demand for luxury skin creams helped Lancome owner L’Oreal beat sales forecasts in the fourth quarter, as did a pickup in its lagging mass market division.
Like rivals including US-based Estee Lauder, the French maker of Maybelline and Urban Decay make-up has thrived on strong demand from Chinese shoppers in recent years, especially for its higher-end products.
Sales of L’Oreal’s top-flight brands exceeded analyst expectations in the last three months of the year thanks to this market, despite cooling economic growth in China, and fears over a Washington-Beijing trade war.
Some heavy-hitters in the luxury fashion industry, such as LVMH’s Louis Vuitton, have also reported encouraging momentum in Asia. At L’Oreal Asia-Pacific overtook North America as its biggest region last year.
But L’Oreal, which is due to detail its results at a news conference on Friday, also faces a challenge to keep improving revenue growth in other areas, including its consumer products unit, home to brands like Garnier shampoo.
Sales rose 2.8 per cent in that division on a like-for-like basis in the fourth quarter, which strips out currency effects and acquisitions, up from 2.3 per cent a quarter earlier.