CA Cheuvreux Autumn Conference

Transcription

1 CA Cheuvreux Autumn Conference September 26 th, 2011 Mr Jean-Paul Agon Chairman & Chief Executive Officer CA Cheuvreux 31 août 2011 Autumn Conference 26 th September 2011

2 Key figures 1 st cosmetics group worldwide 23 international brands 19.5 billion euros sales in % operating margin* 2,371 m net profit** 130 countries 66,600 employees 612 patents registered in 2010 * 2010 figures ** Net profit excluding non-recurring items after non-controlling interests does not include capital gains and losses on disposals of long-term assets, impairment of assets, restructuring costs, as well as competition litigation, and associated tax effects or non-controlling interests.

3 Leading cosmetics groups worldwide Sales (in Bn US$) WWD Beauty Biz Ranking August Sales Beauty s Top 100 in Bn US dollars L'Oréal Procter & Gamble* Unilever* Estée Lauder* Shiseido* Avon Beiersdorf* Kao Corp.* Johnson & Johnson* Chanel* * Estimates - 3 -

4 OUR MISSION TO OFFER WOMEN AND MEN THE WORLD OVER THE BEST QUALITY, MOST EFFECTIVE, SAFEST COSMETICS AND THEREBY SATISFY ALL THEIR BEAUTY NEEDS AND DESIRES IN ALL THEIR INFINITE DIVERSITY.

5 AGENDA The cosmetics market mid-2011 L Oréal outperforms the market 1 2 Solid and good quality half-year 2011 results 3 Second half 2011 prospects 4 Confidence in L Oréal s business model 5

6 The worldwide cosmetics market* Estimates** + 4.2% + 4.1% + 2.9% + 1.0% st half 2011 * Excluding soaps and oral care ** L Oréal estimates. Provisional estimates for the 1 st half 2011.Growth at constant exchange rates

7 The worldwide cosmetics market* Estimates** By distribution channel By geographic zone Weight (%) (1) 1 st Half 2011 Weight (%) 1 st Half 2011 Hair salons 6.5% +1.1% Mass market 52.6% +3.7% Luxury 19.8% +6.4% Pharmacies 4.0% +3.0% TOTAL +4.1% Western Europe 24.7% +0.9% North America 20.4% +3.9% Japan 12.3% -3.8% New Markets excl. Japan 42.6% +8.8% TOTAL +4.1% * Excluding soaps and oral care **L Oréal estimates. Provisional estimates for the 1 st half Growth at constant exchange rates. (1) Including other distribution channels: 17.1% of the cosmetics market - 7 -

8 The weight of the New Markets in the worldwide cosmetics markets (%)* 55% of the cosmetics market 75% of present market growth 55% H % 27% 53% * L Oréal estimates excluding soaps, razors, toothpastes - 8 -

9 AGENDA The cosmetics market mid-2011 L Oréal outperforms the market 1 2 Solid and good quality half-year 2011 results 3 Second half 2011 prospects 4 Confidence in L Oréal s business model 5

10 The worldwide cosmetics market* and L Oréal like-for-like cosmetics sales at end-june % + 5.3% * Excluding soaps and oral care. L Oréal estimates 1 st half 2011 growth at constant exchange rates. Cosmetics market* L Oréal cosmetics sales

11 Key figures 1 st Half 2011 Sales growth by division and branch (% growth) Like-for-like Professional Products +2.1% At constant exchange rates +5.4% Consumer Products +5.2% Luxury Products +8.5% Active Cosmetics +3.2% COSMETICS TOTAL +5.3% +5.8% The Body Shop +2.6% Dermatology* / Galderma +5.3% CONSOLIDATED TOTAL +5.2% +16.4% +5.9% * Group share, i.e. 50%

12 Key figures 1 st Half 2011 L Oréal s cosmetics sales* by region Total New Markets +10.1% North America +5.8% Western Europe +0.8% Eastern Europe -3.4% Japan -3.9% Asia-Pacific excl. Japan +16.5% Latin America +17.3% Africa Middle East +10.1% * Like-for-like growth

13 AGENDA The cosmetics market mid-2011 L Oréal outperforms the market 1 2 Solid and good quality half-year 2011 results 3 Second half 2011 prospects 4 Confidence in L Oréal s business model 5

14 Gross profit is improving (as a % of sales) First half 2010 First half 2011 Gross profit (as a % of sales) 71.3% 71.5% +20 basis points

15 "Strategic Contribution" (as a % of sales) 1 st Half st Half 2011 Operating profit 17.3% 16.8% Research & development expenses 3.2% 3.4% Advertising & promotion expenses 30.5% 30.9% TOTAL 51.0% 51.1%

16 Earnings per share / Net profit / Gearing Earnings per share* ( ) Net profit** ( m) 1, ,466.6 % change +5.4% +11.6% Gearing*** 11.7% 3.3% * Diluted earnings per share based on net profit excluding non-recurring items, attributable to owners of the company ** Attributable to owners of the company *** Net debt / equity attributable to owners of the company

17 Payout ratio (as a % of net profit*) 43.0% 44.9% 36.8% 35.7% 36.0% 36.6% 39.6% 38.5% 41.1% 41.3% 33.6% 29.1% 30.2% 31.6% * Taking into account the Sanofi history with regards to dividends

18 AGENDA The cosmetics market mid-2011 L Oréal outperforms the market 1 2 Solid and good quality half-year 2011 results 3 Second half 2011 prospects 4 Confidence in L Oréal s business model 5

19 Strong pipeline of launches for the 2 nd half 2011 Professional Products Consumer Products Luxury Products Active Cosmetics The Body Shop

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22 CA Cheuvreux 31 août 2011 Autumn Conference 26 th September

23 31 août

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25 L Oréal Paris: n 1 brand in mass market Innovation and rejuvenation of the brand Breakthrough innovation in core categories Rejuvenated communication REVITALIFT World N 1 anti-wrinkle range NEW: Total Repair 10 ELSEVE Hair care range NEW: Complete renovation

26 Lancôme: n 1 brand in luxury Deep renovation of the brand A global Beauty Brand Premium Skin care Premium Make up Prestige fragrances Breakthrough innovation Visionnaire Advanced skin corrector for all skin types 20 international patents A new communication, and more prestigious points of sales

27 And great momentum on

28 And great momentum on

29 And great momentum on

30 And great momentum on

31 And great momentum on

32 CONFIDENCE to outperform the market in 2011 and improve the profitability of the group

33 AGENDA The cosmetics market mid-2011 L Oréal outperforms the market 1 2 Solid and good quality half-year 2011 results 3 Second half 2011 prospects 4 Confidence in L Oréal s business model 5

34 Confidence in the strength and sustainability of L Oréal s business model A dynamic and resilient cosmetics market A reorganised and powerful Research and Innovation A comprehensive portfolio of dynamic international brands A vast potential for fast-paced globalisation Prospects for improved profitability

35 Research and Innovation L Oréal, the N 1 worldwide research power in the sector Deep reorganisation of the Research & Innovation Department in research centres and 12 evaluation centres on 5 continents A powerful fundamental Research combined with a localized product development

36 An optimum Brand portfolio that meets all aspirations

37 Breakdown of 2010 cosmetics sales by geographic region balanced STRATEGIC POSITIONS North America 23.7% Latin America 8.4% Western Europe 39.6% Eastern Europe 7.7% Asia- Pacific excl. Japan Japan Africa, Middle- East 3.1% 14.9% 2.7%

38 Vast potential for fast-paced globalisation of our brands Weight of New Markets on cosmetic sales 36.8% 37.4% 25.4% 15.5% 19.1% 8.0% st Half

39 Roadmap to the Next billion consumers Examples of strategic conquests worldwide USA NEW BRAND GARNIER 3 categories 400m sales in 2010 Hair Color Styling Skin Care

40 Roadmap to the Next billion consumers Examples of strategic conquests worldwide BRAZIL CHANNEL DEVELOPMENT ACTIVE COSMETICS 22% market share in dermocosmetics +35% growth

41 Roadmap to the Next billion consumers Examples of strategic conquests worldwide WESTERN EUROPE Maybelline nº1 Maybelline Market share* 22.2% CATEGORY ANIMATION MAYBELLINE 23.8% * Europe panel 12 countries end of june

42 Roadmap to the Next billion consumers Examples of strategic conquests worldwide INDIA HAIRDRESSERS MARKET MATRIX +40% growth 16,000 hair salons 40,000 hairdressers trained

43 Roadmap to the Next billion consumers Examples of strategic conquests worldwide CHINA L'Oréal Luxe n 1 Group LUXURY CONQUEST Lancôme n 1 brand

44 Roadmap to the Next billion consumers Examples of strategic conquests worldwide AFRICA MIDDLE EAST Egypt Pakistan NEW SUBSIDIARIES Nigeria Kenya

45 Vast potential for fast-paced globalisation of our brands L Oréal s market share in the New Markets 7.5% 4.7% Source: Euromonitor Beauty excluding razors, soaps and oral care

46 Vast potential for fast-paced globalisation of our brands L Oréal s market share in Asia excl.japan 11.0% 5.0% Source: Euromonitor Beauty excluding razors, soaps and oral care

47 Prospects for improved profitability Improvement of the gross margin Optimisation in purchasing Improvement in industrial productivity Modernisation and optimisation of the supply chain Optimizing the allocation of A&P resources Improved efficiency of media purchasing: Concentration on 3 to 4 media agencies across the World Return On Investment (ROI) measurement: Use of econometric modelling to optimize allocation of spending Critical mass of our subsidiaries

48 Conclusion L Oréal is thoroughly transforming itself Strategy reframed Organisation reshaped Industrial facilities reorganised Research approach revised Marketing model modernised

49 UNIVERSALISATION ONE BILLION NEW CONSUMERS

50 Autumn 2011 Thierry Prévot Group General Manager, Financial Communications and Strategic Prospective Analysis Tel. : Fax : tprevot@dgaf.loreal.com Françoise Lauvin Head of Investors Relations Tel. : Fax : flauvin@dgaf.loreal.com Avertissement / Disclaimer «Ce document ne constitue pas une offre de vente ou la sollicitation d une offre d achat de titres L Oréal. Si vous souhaitez obtenir des informations plus complètes concernant L Oréal, nous vous invitons à vous reporter aux documents publics déposés en France auprès de l Autorité des Marchés Financiers (également disponibles en version anglaise sur notre site Internet document peut contenir certaines déclarations de nature prévisionnelle. Bien que la Société estime que ces déclarations reposent sur des hypothèses raisonnables à la date de publication du présent communiqué, elles sont par nature soumises à des risques et incertitudes pouvant donner lieu à un écart entre les chiffres réels et ceux indiqués ou induits dans ces déclarations.» "This document does not constitute an offer to sell, or a solicitation of an offer to buy, L Oréal shares. If you wish to obtainmore comprehensive information about L Oréal, please refer to the public documents registered in France with the Autorité des Marchés Financiers (which are also available in English on our Internet site: document may contain some forward-looking statements. Although the Company considers that these statements are based on reasonable hypotheses at the date of publication of this release, they are by their nature subject to risks and uncertainties which could cause actual results to differ materially from those indicated or projected in these statements."