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L’Oréal SA expects slower growth for the overall beauty market this year, according to its CEO, as weakness in China weighs on sales after years of rapid gains.
Nicolas Hieronimus told investors at a JPMorgan event in Paris that he now sees the global beauty market growing between 4.5 percent and 5 percent this year from a previous forecast of 5 percent earlier this year, a L’Oréal spokesperson told Bloomberg News.
Hieronimus blamed the downward revision on a flat market in China, the representative added. The country had long been a growth engine for L’Oréal, with consumers snapping up its high-end cosmetics offerings.
Shares of L’Oréal fell as much as 5.1 percent in Paris and closed 3.4 percent lower. They’ve lost 6.2 percent so far this year.
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Rivals also slipped, with Estée Lauder Cos. down as much as 2.8 percent in New York and Nivea maker Beiersdorf AG closing 2.5 percent lower in Frankfurt.
L’Oréal in April reported a 9.4 percent gain in like-for-like sales during the first three months of the year, which had allayed some concerns about the state of the beauty business. The company’s next quarterly update is set for July 30.
By Angelina Rascouet and Michael Msika
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