Net sales for the six months ending September 2018 grew 12.4% at constant rates to €595.4m ($679m).
Excluding LimeLife, which was acquired by the company earlier in January, and Le Couvent des Minimes, the company’s sales improved by 4.9%.
The company did not share the profit figures but reported that same-stores sales growth for the half year grew to 2%, from 0.6% in the first quarter.
Greater China effect
Local currency sales in Hong Kong grew by 18.6%, which the country attributed to the ‘dynamic’ travel retail market in the region.
Hong Kong proved to be a strong market, capable of weathering the retail impact of Typhoon Mangkhut, which hit last month. The second quarter was further impacted by the conservative spending by Mainland Chinese tourists.
Despite the unfortunate circumstances, the company said that it managed to recruit new customers, with the successful launch of L’OCCITANE’s Immortelle Reset serum.
The 14.1% growth in China was supported by different factors, including the launch of L’OCCITANE’s flagship store on JD.com, which exposed L’OCCITANE to JD’s 300 million customers who are increasingly interesting in natural products.
Additionally, the brand benefited from the appointment of brand ambassadors Liu Shishi and Lu Han, as well as the launch of Immortelle Reset serum.
Serum of success
Reinold Geiger, Chairman and CEO of L’Occitane, highlighted that Immortelle Reset played an important role in the group’s performance.
“We are delighted to see the successful launch of the Immortelle Reset serum and that it is already one of our bestsellers globally,” said Geiger. “It demonstrates the effectiveness of our hero product strategy, which aims to boost customer recruitment, brand awareness and our face care image.”
He added that the new launch contributed to “broad-based improvement” in many key markets. “This leaves us in good stead for the stronger sales that we normally see in the second half of the financial year.”
Growth in other markets
Besides Hong Kong and China, the US and Russia were among the markets with the highest growth in terms of local currency.
Sales in Russia grew by 11.8%, while the US grew by 65.8%, driven by LimeLife and the continued momentum of the Group’s core L’OCCITANE brand. Growth accelerated despite having 15 fewer stores than the same period last year.
The company’s own brick-and-mortar network remained at 1,555 locations, while a total of 88 stores were refurbished or relocated, compared to 97 stores in the same period of last year.
“Looking forward, we will continue to leverage the universal appeal of our natural, organic and well-being attributes in ways that resonate with local markets,” said Geiger.
“Notwithstanding the prevailing macroeconomic uncertainties, we are confident that with our team’s focus and discipline, we will continue to propel our performance and presence in the global beauty market.”
