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REPORT ON L’ORÉAL’S PARTICIPATION IN BOURSOLIVE, THE E-FAIR FOR INDIVIDUAL INVESTORS
Our aim is to combine financial performance and social and environmental performance, because the two go hand in hand. These are fundamental issues for our planet and for the common good.
CHRISTOPHE BABULE,
Chief Financial Officer of L’Oréal
On 27 and 28 June, L’Oréal took part in BoursoLive, the e-fair for individual investors.
Participants were able to explore L’Oréal’s virtual booth, interact and browse the Group’s documentation.
This edition focused on helping individual investors make the right investment choices in an unprecedented economic context marked by inflation, rising interest rates and geopolitical tensions, which are driving up the cost of raw materials.
Christophe Babule, the Group’s Chief Financial Officer, presented the L’Oréal business model and took questions from shareholders participating online.
Despite L’Oréal’s reputation, consumers and investors are not always aware of the scope of the Group’s activities. Can you tell us more?
Christophe Babule: L’Oréal was established more than 110 years ago by a chemist, Eugène Schueller. The Group has continued to grow ever since and is now the world’s number one beauty company, with the most impressive portfolio of around 80 brands, including 35 global brands.
Our largest Division is L’Oréal Luxe, which includes Lancôme, Yves Saint Laurent, Giorgio Armani and “Couture” brands such as Valentino and Prada, which were recently added to our other fragrance brands, such as Mugler, Azzaro and Ralph Lauren.
Our second biggest Division, and by far the biggest in terms of volume, is Consumer Products, with a number of brands available through mass market channels, including L’Oréal Paris, Garnier, Maybelline New York, Mixa in France, and many more.
Our third largest Division is Professional Products, which you find in hair salons. They include L’Oréal Professionnel, as well as more premium brands like Kérastase and Redken.
And finally, our Active Cosmetics Division, whose brands, including La Roche-Posay, Vichy and CeraVe, are available through pharmacies.
The majority of these brands have gradually become part of the Group through targeted acquisitions. The market is constantly growing and L’Oréal’s share of this market is estimated at more than 14%. With its 85,400 employees and a presence across all sectors of the beauty industry in more than 150 countries, our company had sales of 32.28 billion euros in 2021, with ambitions to increase our market share even further.
How can the Group cope with this inflationary period without damaging its profitability?
Christophe Babule: L’Oréal has a very strong balance sheet, which enabled us to weather the Covid-19 crisis with aplomb. Thanks to this financial strength, we have been able to support our partners, such as hairdressers and suppliers. We’re facing strong headwinds, but we know how to manage this type of situation. At L’Oréal, thanks to our capacity for innovation, we launch 10-15% new products each year, which allows us to better valorise our product lines in the eyes of consumers. This leads to growth not just in volume but also in valorisation.
Innovation is part of the DNA of L’Oréal, which has its origins in Research. L’Oréal Research & Innovation represents an annual budget of more than a billion euros, with more than 4,000 researchers worldwide and 517 patents filed in 2021. We firmly believe this scope for innovation will enable us to maintain and strengthen our number one position.
Sustainable development has become one of your company’s strengths. What steps are you taking to support biodiversity and seize development opportunities?
Christophe Babule: Through our L’Oréal for the Future programme, we are bringing about a profound transformation to establish L’Oréal’s leadership in sustainable development. Recently, for the sixth year running, we were awarded the top score (AAA) by CDP(1) for our climate change, forest conservation and water security initiatives. We have also achieved carbon neutrality across all our sites in the United States and in the North Asia Zone (scopes 1 & 2). In addition, we have invested in impact funds, making 50 million euros available for nature regeneration projects. We are well aware that biodiversity plays a vital role in achieving our overall objectives, which are rooted in science-based targets. Our aim is to combine financial performance and social and environmental performance, because the two go hand in hand. These are fundamental issues for our planet and for the common good.
