L’Occitane International S.A. (“L’Occitane” or the “Group”; SEHK stock code: 973), an international group that manufactures and retails beauty and well-being products that are rich in natural and organic ingredients, announces the unaudited trading update for the three months ended 30 June 2019.
SEE ALSO : Estee Lauder launches The Night Is Yours
Net sales for the three months ended 30 June 2019 were €352.5 million, an improvement of 16.2% at constant rates and 18.8% at reported rates compared to the same period last year. ELEMIS became a subsidiary of the Group in March 2019 and its sales have been consolidated since April 2019.
During the first three months of FY2020, Sell-out sales accounted for 68.6% of net sales and amounted to €242.0 million, an increase of 7.0% at constant rates as compared to the same period last year.
This growth was primarily contributed by marketplaces and stores opened last year. As compared to last year, sales of the Group’s Web Sell-out channels (including ELEMIS) grew by 49.9% at constant rates, equivalent to 17.2% of total Sell-out sales. Same store sales growth was 2.0%.
Sell-in sales accounted for 31.4% of the Group’s total sales and amounted to €110.5 million, an increase of 43.1% at constant rates as compared to the same period last year. The increase was primarily driven by ELEMIS.
During the first three months of FY2020, the Group’s core L’OCCITANE en Provence brand saw growth recover in major markets in Europe and Japan, thanks to successful product launches and seasonal campaigns. The brand’s growth accelerated to 4.1% at constant rates, compared with 3.5% in FY2019.
The Group’s new brand, ELEMIS continued to expand as planned, with unaudited growth of 9.3% in the first three months of FY2020. It recorded double-digit growth in its core markets, the UK and the USA, which was offset by temporary weakness in the maritime channel due to near-term inventory control measures.
Excluding the maritime channel, ELEMIS’s growth was 23.8%. However, LimeLife’s sales decreased by 14.8%, due to a high base last year when sales were boosted during the rebranding exercise from LimeLight to LimeLife.
In terms of geographic markets, the UK, Other countries, Russia and Brazil all posted encouraging growth, with growth at constant rates of 253.0%, 18.7%, 16.4% and 13.6% respectively.
China remained strong with 8.3% growth at constant rates, driven by a successful digital strategy that uses a combination of own e-commerce, marketplace and web partner channels. Meanwhile, Hong Kong saw a marked decline in retail sales as economic and social factors dampened consumer sentiment.
Mr. Reinold Geiger, Chairman and Chief Executive Officer of L’Occitane, said, “We are pleased about the accelerating sales growth of L’OCCITANE en Provence. It is also encouraging to see decent growth in more mature markets, such as Japan and Europe. Our growth in China remained robust despite the prevailing global macroeconomic uncertainties and a high base.”
“ELEMIS, our recent acquisition, is already having a pronounced impact on our top-line and will support our profitability in FY2020. We look forward to expanding this brand into new regions such as the Asia-Pacific in the coming months to maximise its potential. We also look forward to announcing new exciting product launches in the near future, which should further strengthen our foothold in the premium beauty market.”