highlights - group l'occitane · gross profit margin 83.3% 83.2%-0.1 pp operating profit...

Highlights

2

*The figure illustrates dividends declared for the period indicated, not actual dividends paid during theperiod indicated. Final dividend of €0.0297 per share proposed for the year ended 31 March 2019 issubject to the approval of the shareholders of the Company at the forthcoming AGM.

(million €) FY2018 FY2019 Change

Net sales 1,319.4 1,426.9 +8.1%

Gross profit margin 83.3% 83.2% -0.1 pp

Operating profit margin 10.7% 10.6% -0.1 pp

Net profit margin 7.3% 8.2% +0.9 pp

Earnings per share (€ per share) 0.066 0.081 +22.7%

Dividend per share (€ per share)* 0.0297 0.0297 -

3

Net Sales Breakdown

By Business Segment By GeographyBy Brand

* Others include emerging brands Melvita, Erborian and L'Occitane au Brésil

USA16.3%

Japan15.6%

China12.5%

Hong Kong9.6%

France7.2%

UK4.3%

Brazil4.0%

Russia3.6%

Taiwan2.7%

Other countries

24.3%

Sell-out

75.4%

Sell-in24.6%

L'Occitane en Provence

87.4%

LimeLife5.9%

Others *6.7%

4

(1) Others include LimeLife, marketplaces, mail-orders and other service sales (2) Excluding the impact of foreign currency translation effects

Net sales up 8.7% at constant exchange rates(8.1% at reported rates)

-50

150

350

550

750

950

Compstores

Non-compstores & others

Sell-in FX rates

million €

FY2018

FY2019

11%

overall sales growth: 8.1%local currency growth: 8.7%

currencies: -0.6%

Contributionto growth (2) :

71% 19%

+2%

+26% +6%

(1)

overall sales growth: 8.1%

5

(1) Excluding foreign currency translation effects(2) Excluding LimeLife, growth was -2.0% at constant rates, due to the net 12 stores closed this year

Sales growth by geography – Americas and Europe(at constant rates)

0

50

100

150

200

250

France UK USA Brazil Russia

FY2018 FY2019

1% 1% 48% 6%

+1%

+32%

5%

+11% +12%

Contributionto growth (1) :

+1%

million €

(2)

6

(1) Excluding foreign currency translation effects

Sales growth by geography – Asia and Other Countries(at constant rates)

-50

0

50

100

150

200

250

300

350

400

Japan Hong Kong China Taiwan Othercountries FX rates

FY2018 FY2019

0% 9% 17% -1% 14%

+0%

+9%+12%

-3%

+5%

Contributionto growth (1) :

million €

7

(1) Including own E-commerce and excluding stores closed for renovation

Same store sales growth profile (1)

FY2019 compared to FY2018

0.3% 1.5%

15.1%

-2.7% -0.2%

1.7%

-0.3% -2.6%

6.9%

-2.7%

2.2% 1.8%

Japan Hong Kong China Taiwan Othercountries

Group

FY2018 FY2019

-2.9%

0.2%

-2.7%

4.5%0.4%

-2.1% -0.1% 0.0%

5.9% 5.4%

France UK USA Brazil Russia

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Profitability analysis

% of net sales

FY2018 FY2019 Change

Gross profit margin 83.3 83.2 (0.1)

Distribution expenses (48.5) (49.1) (0.6)

Marketing expenses (13.6) (13.0) 0.6

Research & development expenses (1.3) (1.3) 0.0

General & administrative expenses (9.3) (9.3) 0.0

Other losses & gain from J.V. 0.1 0.0 (0.1)

Operating profit margin 10.7 10.6 (0.1)

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Gross margin (as % of net sales)

83.3%

-0.2 -0.2 -0.1 +0.3 +0.1

83.2%

FY2018 Brandmix

(LimeLife)

othersrounding

MPP&

boxes

productionfreightduties

pricing&

productmix

FY2019

10

Distribution expenses (as % of net sales)

(48.5%)

-0.6 -0.4 -0.3 -0.2 -0.1 +0.5+0.5

(49.1%)

FY2018

brandmix

(LimeLife)

investretail

TR

investlargestorerental

promotools

others logisticschannel

mix

lowerpre-

openingclosing FY2019

11

Marketing expenses (as % of net sales)

(13.6%)

+0.3 +0.2 +0.2 -0.1

(13.0%)

FY2018

brandmix

(LimeLife)

adv,eventpromo

toolleverageefficiency reclass FY2019

12

G&A expenses (as % of net sales)

(9.3%)

-0.6 -0.1 +0.2 +0.2 +0.2 +0.1

(9.3%)

FY2018 LimeLifemiscel-laneous leverage

lowerpersonel

reclass,rounding FX FY2019

13

Operating profit margin (as % of net sales)

10.7%

-1.1

-0.7 +0.5 +0.5+0.4 +0.1 +0.1 +0.1

10.6%

FY2018 LimeLife

Brandmix

investlarge

storesBA

leverageefficiency

lowerpre-

opening

channelmix

savingmktg

priceproduct

mix

FX FY2019

14

Effective tax rate

(29.0%)

+5.5

+3.2

+1.0+0.8 -2.2

(20.7%)

FY2018

UStaxcutLY

countrymix FX other

derecognitionoftax

credits FY2019

15

Capital expenditures(excl. acquisitions of subsidiaries and financial investments)

62.1

14.0 16.4

0.4

92.9

41.8

18.624.4

1.5

86.3

stores Info.Tech.

factoriesR&D

others Total

million €

FY2018 FY2019

16

Working capital ratios

Inventory turnover days

243

+17+12 +5 +3 -7

273

FY2018 LimeLife Elemis FX lowerprovision

lowerinventory

FY2019

existing brands

as at: FY2018 FY2019 Change

Inventory turnover days (based on cost of sales) 243 273 30

Trade receivables turnover days (based on net sales) 30 32 2

Trade payables turnover days (based on cost of sales) 188 203 15

Cash Cycle (days of net sales) 39 44 5

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Balance sheet ratios

FY2018 FY2019

ProfitabilityReturn on Capital Employed (ROCE)(1) 15.1% 15.9%Return on equity (ROE)(2) 10.3% 11.6%

LiquidityCurrent ratio (times)(3) 3.1 2.2Quick ratio (times)(4) 2.4 1.4

Capital adequacyGearing ratio(5) 6.8% 29.4%Debt to equity ratio(6) net cash 40.0%(1) Net Operating Profit After Tax # / Capital Employed # #

(2) Net profit attributable to equity owners / shareholders' equity excluding minority interest(3) Current assets / current liabilities(4) Current assets - stocks / current liabilities(5) Total debt / total assets(6) Net debt / (total assets - total liabilities) * 100%# NOPAT = (Operating Profit + foreign currency net gains or losses) x (1 - effective tax rate)

Capital Employed = Non-current assets - (deferred tax liabilities + other financial liabilities + other non-current liabilities) + working capital

# # Capital Employed calculation excluded the goodwill on Elemis as the profit will only be consolidated in FY2020 onwards.

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Strategic review

Multi-brand Strategy Omni-channel Experiences

Skincare PositioningEfficient & Entrepreneurial

Organization

Engaging Marketing Campaigns

Sustainability

- ELEMIS acquisition complements the Group’s channel and product portfolio

- Refocused LimeLife’sinternational strategy

- Continued growth for emerging brands

- Immortelle Reset serum became global bestseller and grew face care mix

- ELEMIS acquisition will bolster this segment further

- Leveraged expertise of local marketing teams to create culturally-relevant and impactful campaigns

- Targeted investments lowered marketing expenses as a percentage of net sales

- Created memorable and consistent online and offline experiences

- Flagship stores in New York and London won prestigious awards for retail design

- Empowered teams and encouraged entrepreneurial spirit through new incentive scheme

- Other operational improvements: ship-from-store, factory in Brazil

- Sustainability is prioritized at every step of the value chain

- Recently signed multi-year agreement with Loop Industries to transition to 100% sustainable PET plastic packaging

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Outlook

“Pulse” Strategy Multi-brand Group Solid Product Pipeline

- Continue to execute the “Pulse” strategy to build trust, achieve sustainable growth and enhance profitability

- Expect to see enhanced profitability with targeted investments and the consolidation of the ELEMIS brand

- Operate as multi-brand group where unique brand identities are celebrated and common values shared

- Brands stay autonomous and agile while seeking synergies

- Product innovation remains key

- Ongoing hero product strategy will place emphasis on face care

The Group remains confident to pursue its mission to be a leader in the affordable premium beauty space and deliver long-term value to its shareholders

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This document is for information purposes only without any binding effect; in caseof any inaccuracies, incompleteness or inconsistency with other documents, onlythe Company’s latest issued annual or interim report for detailed financials shallprevail and shall be deemed to be the only official document.

The financial information and certain other information presented in a number oftables have been rounded to the nearest whole number or the nearest decimal.Therefore, the sum of the numbers in a column may not conform exactly to thetotal figure given for that column. In addition, certain percentages presented in thetables reflect calculations based upon the underlying information prior to roundingand, accordingly, may not conform exactly to the percentages that would bederived if the relevant calculations were based upon the rounded numbers.

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