L’Oréal Quarterly Sales Decline on Currency Shifts And Slowing U.S.

PARIS, France — L'Oréal SA, the world's largest cosmetics maker, reported a 2.2 percent drop in first-quarter revenue as unfavorable currency fluctuations and slowing demand in North America weighed on growth.

Revenue fell to 5.64 billion euros ($7.8 billion) from 5.77 billion euros a year earlier, Paris-based L’Oréal said today in a statement after European markets closed. Analysts predicted 5.71 billion euros, based on the average of seven estimates compiled by Bloomberg. Excluding currency shifts and acquisitions, revenue increased 3.5 percent.

Currency movements reduced revenue by 5 percent in the period, while L'Oréal's consumer-products division is experiencing a "sluggish trend" in North America, the company said. Weaker demand and a loss of market share to rivals such as Procter & Gamble Co. could continue to drag on L'Oréal's growth in the region this year, according to Andrew Wood, an analyst at Sanford C. Bernstein.

L’Oréal said in February that first-quarter revenue growth in North America would trail the 6.3 percent it recorded in the same period last year amid destocking by distributors. L’Oréal’s full-year revenue growth should exceed its forecast for a 3.5 percent to 4 percent expansion of the global cosmetics market, Chief Executive Officer Jean-Paul Agon said at the time.

By Andrew Roberts; Editors: Celeste Perri, Paul Jarvis, Robert Valpuesta.