HONG KONG—L’Occitane International S.A., a global, natural and organic ingredient-based cosmetics and well-being products enterprise, reported a 13.9-percent increase in net sales for the year (ending March 31, 2010; [FY2010]) from a year ago, its first set of annual results after its successful listing on the main board of The Stock Exchange of Hong Kong on May 7, 2010.
Net sales increased to €612.2 million from €537.3 million. Operating profit increased 36.9 percent to €110.2 million from €80.5 million. Profit attributable to equity holders increased 39.8 percent to €81.6 million from €58.4 million, 10.6 percent above the profit estimate of €73.8 million when the Group launched its IPO earlier this year.
Reinold Geiger, chairman and CEO, L’Occitane, said: “2009 was a year of ups and downs for the world economy. Despite a challenging business environment, we managed to deliver an encouraging set of results for the first time as a listed company. This demonstrates the Company’s strong brand equity and sound planning and execution capability driven by a clear principle for pursuing profitable growth.”
L’Occitane recorded net sales growth in all business segments and geographic areas, except for the United States. Sales in Japan, Hong Kong, the United Kingdom, Brazil and in other countries, including China and Russia, were the driving factors of the net sales growth in FY2010. Net sales growth in Japan, Hong Kong, the United Kingdom and Brazil was 11.6 percent, 15.2 percent, 25.1 percent and 23.0 percent, respectively, while growth in other countries, including China and Russia was 29.8 percent. The combined sales in Japan, Hong Kong and Taiwan accounted for 36.3 of L’Occitane’s total sales in FY2010.
In terms of business segments, net sales contribution from the Sell-out, Sell-in and B-to-B segments amounted to €449.8 million, €141.7 million and €20.7 million respectively. The Sell-out business remained the main sales contributor of the Company, accounting for 73.5% of the total sales in FY2010. The Sell-in business and B-to-B business accounted for 23.1% and 3.4% of total sales in FY2010 respectively.
The Sell-out net sales of the Company increased by 16.4% in FY2010 compared with FY2009, excluding foreign currency translation effects. This increase was due to the addition of stores globally and the acquisition of stores from distributors. Sell-out sales represented 87.1% of overall growth in FY2010 excluding foreign currency translation effects, with Non-comparable Stores and Comparable Stores accounting for 75.8% and 3.9% of growth respectively.
During the period, the Company recorded a same store sales growth of 1.0% for the Sell-out segment, which was driven by an increase in sales transactions from both existing and new customers offsetting a slight decrease in the average prices of L’Occitane’s products, as well as the strong development of internet sales.
The Company recorded an increase of 6.7 percent in FY2010 in Sell-in net sales, excluding foreign currency translation effects, which represented 12.3 percent of overall net sales growth. The increase was primarily due to an increase in sales to duty free stores and wholesale customers and department stores. The growth in B-to-B sales in Japan contributed to an increase of 2.0 percent in B-to-B net sales, which accounted for 0.6 percent of overall net sales growth in FY2010.