Travel retail played a key role as L’OCCITANE Group yesterday revealed strong double-digit sales growth for its full-year ended 31 March against what it described as “a uniquely challenging macroeconomic backdrop”.
The challenges included surging global inflation, widespread recession fears and a sharp COVID-19 related consumer pullback in China, one of the beauty and wellbeing house’s largest markets.
Net sales grew +19.8% at reported rates to €2,134.7 million, exceeding the €2 billion mark for the first time. Excluding the impact of the deconsolidation of the company’ US subsidiary last year, sales grew +17.9% at reported rates and +13.4% at constant rates.
L’OCCITANE said an effective omni-channel strategy had driven a more balanced channel mix, with “dynamic growth” in travel retail and the development of newer brands contributing to strong sales growth of +50.9% in wholesale and other channels.
The addition of digitally-centric brands Elemis and Sol de Janeiro to the Group’s portfolio also supported a +4.8% growth in the online channel despite the recovery in offline sales.
Solid sales growth was generated by the Group’s newer brands, Elemis and Sol de Janeiro, as well as the resilience of the core L’OCCITANE en Provence brand, particularly its improved momentum in the final quarter thanks to travel retail channel (again described as “dynamic”) and early positive signs in China.
On a like-for-like basis, i.e. excluding Russia due to the Group’s divestiture, the newly consolidated brands Sol de Janeiro and Grown Alchemist, the deconsolidation of the US subsidiary last year and at constant rates, sales growth was +3.7% in FY2023.
L’OCCITANE Group Vice-Chairman and Chief Executive Officer André Hoffmann said, “We are cautiously optimistic as we head into FY2024. While the macroeconomic environment remains uncertain, we expect to achieve double-digit sales growth and healthy profitability, supported by significantly higher marketing investments for the core brand in key markets and channels, as well as for our new brands as they enter new markets, including the upcoming launch of Sol de Janeiro and Grown Alchemist in APAC.
“We are convinced that these investments will not only allow us to capitalise on the clear opportunities this year with the gradual return of international travel and a rebound in China, but also to propel our development as a multi-billion Euro, multi-brand group in the years to come.” ✈
