L’Oreal’s Solid Growth Was Boosted By Luxury and Active Cosmetics Segments, Along With Emerging Markets Like China
L’Oreal’s Active Cosmetics Segment grew by 5% like-for-like for the first nine months and the best selling brands have been La Roche-Posay, Vichy, Cera Ve, and Skinceuticals. L’Oreal is one of the leading names in the active cosmetics market. In an effort to further grow its active cosmetics segment, towards the beginning of 2017, L’Oreal acquired the skincare brands, CeraVe, AcneFree, and Ambi from Valeant Pharmaceuticals for a sum of $1.3 billion. These brands are quite popular with health professionals and are expected to almost double the revenue for its active cosmetics division in the U.S. The brands are expected to strengthen the company’s ties with health professionals who are a key towards developing products in the active cosmetics market. L’Oreal’s market position in North America, the fastest growing geography for active cosmetics, is expected to grow further due to the acquisitions. In fact, in Q3 2017, Cera Ve has demonstrated double digit growth in North America. According to a report by Research and Markets, the global cosmeceutical market is expected to grow at a CAGR of nearly 6% between the period of 2017 to 2021. L’Oreal’s acquisitions are expected to aid it in further growing its active cosmetics business and thus increase its market share in segments such as skincare.
(Note: Like-for-like growth implies growth based on a comparable structure and identical exchange rates.)
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