L’Oreal’s 2002 Profits Surge 19% to $1.56 Billion

L’Oreal said currency hedging and cost-control helped boost its profits by a better-than-expected 19% in 2002. It was the 18th consecutive year of profits for the French cosmetics maker. L’Oreal’s net profit was $1.56 billion last year, up from $1.32 billion in 2001.

“Good currency hedging and strict cost control enabled us to continue to improve our margins,” chairman and chief executive Lindsay Owen-Jones said.

Analysts had expected L’Oreal to post a net profit of $1.48 million. L’Oreal’s operating margin rose by 0.8 point to 12.9% from 12.1% in 2001, with improvement seen in all markets, the company said. L’Oreal’s debt-to-equity ratio fell to 4.8% from 12.6% at the end of 2001, thanks to cash flow generated in 2002, the company said.

L’Oreal said its share of profit from its stake in French pharmaceutical group Sanofi-Synthelabo rose 28% to $370 million last year. L’Oreal owns 20% of Sanofi.