Top Companies Report

21. Oriflame

July 29, 2016

Sales: $1.3 billion

Key Personnel: Magnus Brännström, chief executive officer; Jesper Martinsson, senior vice president and head of commercial division and deputy CEO; Gabriel Bennet, chief financial officer; Michael Cervell, senior vice president global direct sales; Thomas Ekberg, senior vice president global business area Asia and Turkey; Emma Hågemo, vice president group strategy; Stefan Karlsson, senior vice president and head of human resources; Johan Rosenberg, senior vice president and head of global business areas CIS and Latin America; Antonia Simon-Stenberg, vice president sustainability and quality management; Katrin Alakbarov, vice president Central Asia & MD Kazakhstan;  Koppany Berkes, vice president commercial marketing, CIS; Robin Chibba, vice president finance Latin America; Alexandra De Greck, vice president commercial marketing; Tatiana Egorova, vice president finance global sales and CIS; Niklas Frisk, vice president and head of Central Europe; Mimmi Fröhlen, vice president product marketing; Krasimir Gaydov, vice president global shared services IT; Konrad Gluchowsky, vice president global logistics; Glapa Grzegorz, vice president manufacturing operational plants; Emma Hågemo, vice president group strategy; Henrik Johannesson, vice president and head of Africa; Christian Jönsson, senior vice president global shared services; Sergei Kanashin, senior vice president and head of South Asia and MD India; Mary Lord, senior vice president research and development; Joanna Poplawska, senior vice president group manufacturing; Santiago Salazar, vice president and head of Latin America & MD Mexico; Antonia Simon-Stenberg, vice president sustainability and quality management; Armando Stagno, vice president global supply chain.

Major Products: Skin care, color cosmetics, fragrance, personal care and hair care, accessories and wellness products. 

New Products: Eyes Wide Open Mascara, the Colour Unlimited Matte Lipstick and 5-in-1 Colour Stylist Cream Lipstick from The One; Tenderly Promise and Giordani Gold Essenza Parfum fragrances; Eleo hair care.

Comments: Sales slipped a bit last year, as skin care became the company’s largest product category, accounting for 25% of sales, which ousted color cosmetics (23%). Personal and hair care represented 17%, fragrances 20%, wellness 7% and accessories 8%, according to the company.

Oriflame said during the past year it continued to experience strong performance in its key growth regions of Latin America and Turkey, Africa and Asia, while conditions in CIS remained challenging. However, Oriflame said encouraging trends could be seen in Europe.

For the three months ended March 31, 2016, sales fell 1% due to currency fluctuations.

“We are pleased with the overall local sales development during the first quarter, where sequential improvements are seen in most geographies,” said CEO Magnus Brännström, when the Q1 performance data was released earlier this year. “Asia and Turkey and Latin America continued to record double digit growth and increased profitability.”

While noting that the reversal of the previous negative sales trend in the CIS is promising, Brännström said that the situation remains uncertain with sustained external and margin improvement challenges.

“The positive sales momentum for the group has continued into the second quarter, further enhanced by some strong catalogues in April,” he said. “The underlying business and financial performance is encouraging, although we continue to be heavily impacted by persistent currency headwinds and deteriorating macro across many of our regions. Efficiency initiatives are ongoing and are delivering desired results.”

On the sustainability front, Oriflame says it has continued to take steps to implement more sustainable palm oil. In 2015, 10% of the palm oil used was mass balance certified palm oil, and the remaining share was covered by GreenPalm credits.

In October, the Swedish Initiative on Sustainable Palm Oil in Cosmetics and Detergents was launched with Oriflame as one of the co-initiators. The purpose of the initiative is to work for the transformation from using conventional palm oil and palm kernel oil to sustainable palm oil and palm kernel oil in cosmetics and detergents. The initiative is a collaboration between the Swedish Cosmetics, Detergents and Toiletries Association, retail and grocery companies and manufacturing brands.