L’OREAL expects slower growth for the overall beauty market this year, according to its CEO, as weakness in China weighs on sales after years of rapid gains.
Nicolas Hieronimus told investors at a JPMorgan event in Paris that he now sees the global beauty market growing between 4.5 per cent and 5 per cent this year from a previous forecast of 5 per cent earlier this year, a L’Oreal spokesperson said.
Hieronimus blamed the downward revision on a flat market in China, the representative added. That country had long been a growth engine for L’Oreal, with consumers snapping up its high-end cosmetics offerings.
Shares of L’Oreal fell as much as 5.1 per cent in Paris and closed 3.4 per cent lower. They have lost 6.2 per cent so far this year.
Rivals also slipped, with Estee Lauder down as much as 2.8 per cent in New York and Nivea maker Beiersdorf closing 2.5 per cent lower in Frankfurt.
L’Oreal in April reported a 9.4 per cent gain in like-for-like sales during the first three months of the year, which had allayed some concerns about the state of the beauty business. The company’s next quarterly update is set for Jul 30. BLOOMBERG
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