Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on L'OREAL. We currently have 6 research reports from 1 professional analysts.
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Healthy organic growth in 2016 but Body Shop still an issue
10 Feb 17
Sales in Q4 edged up 4.8% lfl (4.4% reported) to €6,789m. Growth was led by L’Oréal Luxe products and Active cosmetics growing by respectively 7.1% and 6.5% lfl. Consumer products sales increased by 4.2% and Professional products posted a modest 2.1% rise. The full-year sales were up 4.7% lfl to €25,837m (+5.1% at CER and +2.3% reported). Professional products edged up by low single-digit rate to €3,400m. Consumer products increased by a modest 4.4% lfl to €11,993m. Luxe products surged by 6.9% to €7,662m. Active cosmetics were up 5.7% to €1,861m. Body Shop products remained almost flat on a lfl basis at €920.8m (down 4.8% reported). Growth was driven by a favourable sales momentum in North America increasing by 5.8% to €7,099m and Asia Pacific edging up by 3.6% to €5,635m. The strong dynamism in Latin America and Eastern Europe raised sales to €1,838m (+11.1% lfl) and €1,571m (+10.4% lfl) respectively. The gross margin gained 40bp to 71.6% with a gross profit at €18,495m. Operating profit was up 3.5% to €4,540m, i.e. an operating margin of 17.6%. Most segments raised their operating margins, led by L’Oréal Luxe which increased its margin to 21.2% (€1,623m). Consumer products generated an operating profit of €2,417m. All regions raised their profit, led by North America where the operating profit was up by 10.8% to €1,392m. Western Europe generated an operating profit of €1,831m, still the highest margin at 22.9%. Dividends received from Sanofi increased slightly by 2.8% to €346.5m. Net profit retreated by 5.8% to €3,106m due to non-recurring charges of €541m net of tax, which corresponds mainly to the Magic and Clarisonic impairment impact. Gross cash surged by 7.2% to €4,717m. WCR remained almost flat and investments were consolidated to 5.4% of sales at €1,386m. The financial position remains strong with a positive net cash of €481m. The proposed dividend is €3.3, i.e. an increase of 6.45%.
Solid organic growth in Q3 strengthens confidence
04 Nov 16
L’Oreal experienced favourable market momentum in Q3 across all regions and all product categories. Group sales accelerated with organic growth of 5.6% to reach €6,153m (+4% on a reported basis). As regards products, Cosmetics edged up 5.6% lfl (€5,952m), underpinned by the outperformance of L’Oréal Luxe which surged 9.3% lfl to reach €1,858m. Consumer products’ sales amounted to €2,859m, i.e. a rise of 4.7%. Professional products posted almost flat sales (+0.9% lfl) at €808.5m. Active cosmetics’ sales were up 6.5% to reach €425.7m. The Body Shop division grew 2.8% lfl to €200.9m. By geography, the strong momentum in North America, which is the second largest market for L’Oreal, has underpinned the group’s performance with 7.5% organic growth and sales worth €1,755m. Sales in Western Europe grew slightly by 2.2%, while in Eastern Europe they jumped 11.7%. In Asia, sales posted a single-digit growth rate of 3.2% to reach €1,324m. Over the first nine months, group revenues amounted to €19,048m, i.e. an increase of 4.7% lfl (+4.9% at CER and +1.6% on a reported basis). E-commerce sales edged up 32%.
Root & branch review – early margin positive
23 Feb 17
Unilever (ULVR LN, HOLD, T/P 3800p) announced yesterday that it will publish the findings of a root and branch review in April 2017. This is stated as being a result of the recent approach made to them by KraftHeinz (KHC US, N/RO), an offer which quickly lapsed.
A compelling global brand roll-out story
22 Feb 17
We believe that SuperGroup remains one of the most undervalued global brand roll-out stories within the UK retail sector. The stock trades at c20% discount to its UK peers on a 1YF EV/EBITDA basis despite best-in-class revenue growth and profit margins. SuperGroup operates a leading multi-channel proposition, has strong sales momentum across each channel and forecast risk remains on the upside. We initiate coverage on the shares with a buy recommendation and price target of 1898p, implying upside of 27.8% over the prevailing market price.
N+1 Singer - Swallowfield - Owned Brands outperforming as hoped
28 Feb 17
H1 PBT leapt 363%, beating expectations by 4%. This was driven by strong organic performance and by Brand Architekts’ growth stepping up versus pre-acquisition performance. Integration has gone extremely well and another new brand was successfully launched. This has led us to upgrade underlying divisional profit by £0.5m. However, the share price rally has led to an increased LTIP provision, which offsets the upgrade. The shares therefore look up with events in the short term.
The Slide Rule
12 Jan 17
What is The Slide Rule? The Slide Rule has been designed to dramatically simplify the identification of the best companies in the UK small/mid-cap sector by making a quantitative assessment of the relative potential of each company. At its core, The Slide Rule aims to identify those companies that create genuine shareholder value through strong returns on capital and solid growth, but also present a value opportunity with the potential tailwind of earnings momentum. Companies are assessed within a Quality, Value, Growth and Momentum (QVGM) framework.
Preparing for growth
27 Feb 17
McBride is halfway through its restructuring plan, having completed the Repair phase, and is now implementing the Prepare part. This should set McBride up for more sustainable and profitable growth. What sets this programme apart from previous attempts is management’s absolute focus on tight cost control and business simplification. This should avoid increased overheads and complexity creeping back into the system as the business starts to grow again.