L'Oréal Sales Bolstered by Weak Euro

By Nadya Masidlover 

PARIS--French cosmetics giant L'Oréal SA posted a strong rise in first-quarter sales, buoyed by a "very positive currency impact" following the recent slide in euro against the dollar.

The company--home to brands including Lancôme, L'Oréal Paris, Garnier, Maybelline New York and Redken--posted a 14% on-year rise in revenue to EUR6.44 billion ($6.93 billion) from EUR5.64 billion a year earlier. L'Oréal said currency effects contributed 8.9% to overall growth.

Stripping out the currency impact, acquisitions and disposals, sales were up 4%, as growth in Europe and the U.S. remained subdued while business in Latin America, Africa and the Middle East boomed.

L'Oréal Chief Executive Jean-Paul Agon said that the group had made "an encouraging start to the year," benefiting from "a very favorable monetary environment" in the first quarter.

"In an economic context that is still volatile, we confirm that we are confident in our ability to outperform the market this year once again, and to achieve growth in sales and profit," Mr. Agon said in a statement.

L'Oréal is one of a number of European companies to have received a boost from the recent strength of the dollar, which has bolstered the value of sales made abroad in dollar-related currencies. Last week, U.K.-based Unilever PLC--maker of Dove beauty products and Axe deodorants--reported a double-digit increase in first-quarter sales, largely on the back of currency effects. Meanwhile, French luxury goods company LVMH Moët Hennessy Louis Vuitton SA reported a 13% positive exchange rate impact on its sales growth for the first three months of the year.

The upbeat figures from European firms mark a contrast with U.S. rivals that are struggling in the face of currency headwinds. In January, Procter & Gamble Co. -- the world's biggest consumer-products maker--trimmed its outlook for 2015, citing foreign-exchange issues.

In the first quarter, revenue in North America--where the Paris-based sells around one-quarter of its cosmetics--increased 25% to EUR1.62 billion. On a like-for-like basis, which excludes currency variations, assets purchases or divestments, revenue rose a more modest 2.4%. L'Oréal said that brands such as Kiehl's, Giorgio Armani and La Roche-Posay helped drive growth in the region.

Sales in Western Europe grew 4% to EUR2.1 billion over the period, while in the company's New Markets region--which includes Asia, Latin America, the Middle East and Africa --sales jumped 17% to EUR2.52 billion.

Write to Nadya Masidlover at [e-mail]

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