Sales and Profits Slip at L’Oréal

It was a tough year for the largest beauty company in the world last year. L’Oréal SA’s profit and sales fell as the French cosmetics giant shuffled its offerings and its focus to reach less-affluent consumers and lost market share.

“After a difficult start to the year due to a contraction in sell-out and drastic inventory reduction by the trade, the cosmetics market has gradually improved and ended up slightly positive. In this context, L’Oréal has weathered the crisis well and confirmed its position as the world leader in beauty,” said Jean-Paul Agon, the company’s chief executive officer. “Overall, L’Oréal has emerged from 2009 stronger and has prepared itself well for a return to sales and results growth in 2010.”

L’Oréal, home to a range of brands such as Garnier, Lancôme and Kiehl’s, said full-year net profit dropped 6% to $2.5 billion. Sales edged down 0.4% in the year to $24.37 billion, in part due to an unexpected slowdown in the fourth quarter as other consumer products companies begin to recover from the economic crisis. For the fourth quarter alone sales fell 3.5% to $6.6 billion.