L'Occitane FY2022: The Sales in Chinese Mainland Surge 24%
- Chaileedo Press
- Jun 29, 2022
- 3 min read
In FY2022, the net sales of L'Occitane grew by 15.8% to $1.87 billion, , while net profit reached a record high of $254 million, 57.5% growth compared to FY2021. The excellent performance of the group was mainly due to its brands L'Occitane en Provence and ELEMIS.
On June 27, L'OCCITANE INTERNATIONAL S.A., a leading French skin care group listed in Hong Kong, China, announced its key financial figures for the fiscal year 2022. Despite continued turbulence in the macroeconomic environment in FY2022, the group posted outstanding results with a record net profit of $254 million, 57.5% growth as compared to FY2021.
The reported net sales were $1.87 billion, representing an increase of 15.8%; the operating profit jumped 43.3% to a record high of $325 million; while the operating margin rose 3.3% year-on-year to 17.4%, the highest level since the group went public.
CHAILEEDO learned that the record results were contributed by the very strong operational performance of the core brand, L’Occitane en Provence, as well as the development of the Group’s other brands, notably ELEMIS.
In terms of brands, in FY2022, L'Occitane en Provence sold $1.46 billion, accounting for 76.8% of total net sales; ELEMIS sold $237 million, accounting for 12.5%; Lime Life sold $74.22 million, accounting for 3.9%; Solde Janeiro's sold $27.37 million, accounting for 1.4%.
When it regards to channels, L'Occitane saw growth in the online channel and a strong rebound in the retail channel. According to the report, this was mainly due to the continued improvement in the business environment as the restrictions related to COVID-19 were lifted in Europe and the United States. In addition, the travel retail, spa and cruise businesses also benefited from the rebound in local and international visitors. As of March 31, 2022, L'Occitane had 1,490 stores worldwide, a decrease of 33 stores compared to last year, reflecting the group's further closures of under-performing stores worldwide. Among them, L'Occitane closed 21 stores in the US alone.
As for regions, L'Occitane achieved sales growth of varying degrees worldwide. In particular, the group's net sales in China (which means Chinese Mainland), the United States, the United Kingdom and Hong Kong, China, increased by 16.8%, 13.5%, 21.4% and 24.0%, respectively.
André Hoffmann, the Vice Chairman and Chief Executive Officer of L'Occitane, said, "We acquired two strong brands, Sol de Janeiro and Grown Alchemist, in the fiscal year 2022, which will help the group accelerate the entry into new markets and attract younger consumers."
Looking ahead to FY2023, L'Occitane expects the sales to exceed 2 billion euros ($2.097 billion) in fiscal 2023, while maintaining solid profitability. It is reported that the group's sales exceeded 1 billion euros ($1.049 billion) in FY2013, which meant a significant milestone of the group.
In recent years, L'Occitane has stepped up its presence in the Chinese market, successively partnering with many well-known Chinese actors and artists, such as Luhan, Liu Shishi, Bai Jingting, Zhao Liying and Zhu Yilong. In addition, the group continues to leverage its strengths in e-commerce platforms, with sales exceeding 100 million yuan ($14.91 million) in the Double 11 Shopping Festival launched by Tmall in 2021.
In FY2021, China has become L'Occitane's biggest market and the only market in which the group achieved positive growth worldwide. According to the latest financial report, the Chinese market continued to perform well in the past fiscal year.
China’s net sales for FY2022 were $344 million, an increase of 24.4% as compared to FY2021. Specifically, the group achieved growth in all channels in China, with the online channel performing particularly well. Otherwise, L'Occitane noted that e-commerce sales accelerated in the fourth quarter of fiscal 2022, accounting for 33.1% of total sales for the year.
It is worth noting that L'Occitane reported that the overall sales momentum remained strong throughout the year until restrictive measures were taken by the government in major cities in March 2022.
In FY2022, L'Occitane opened 10 new stores in China. Among them, ELEMIS opened one new store in Shanghai and one in Nanjing. At present, China remains the market where the group has opened the most stores, with a total of 208.
In Hong Kong, China, the reported net sales of the group were $125 million in FY2022, achieving a 25.7% growth compared to FY2021. The group said the strong performance in the region was mainly due to the expansion of travel retail channels and web partners.
With the lifting of COVID-19 prevention and control measures in Shanghai, China, L'Occitane's logistics in China have returned to normal in June this year. According to the fiscal report, the group remains confident in the Chinese mainland market and forecasts double-digit sales growth in China in FY2023.
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