Net earnings per share**: +12.3%
(+8.5% based on reported figures)
Net Profit**: +10.1%
(+6.4% based on reported figures)

+40 basis points to 17.3% of sales

FOR 2008:

Commenting on these figures, Mr Jean-Paul Agon, Chief Executive Officer of L’Oréal, said:


“The first-half results are very encouraging. In view of the scale of the currency fluctuations noted since the beginning of the year, performance should be considered on a comparable exchange rate basis*.

With a progression of +7.1% in sales at constant exchange rates*, L’Oréal has continued to gain market share worldwide and is making progress, according to our estimates, significantly ahead of the cosmetics market.

With an improvement of 40 basis points, operating profitability is once more progressing very strongly, reaching a record level. Our continued efforts in product value enhancement and productivity have enabled us to compensate for increases in the prices of raw materials and energy. These results, combined with a slight reduction in the tax rate, enable us to achieve a substantial increase in our net profit.

This performance, achieved in what everyone recognises is a difficult economic environment, confirms the solidity and the dynamism of the L’Oréal business model.

In view of these achievements, the extensive launch programme up to the end of the year, and our continuing efforts to keep costs under strict control, we look forward with confidence to achieving double-digit growth in net earnings per share, at constant exchange rates, for 2008*.”



* based on constant translation rates:

 2008 data at 2008 rates / 2007 data at 2008 rates

** Net profit excluding non-recurrent items after minority interests


Based on reported figures, the group's sales, at June 30th 2008, amounted to 8.646 billion euros, an increase of +1.6%. Like-for-like, i.e. based on a comparable structure and identical exchange rates, the increase in the sales of the L'Oréal group was +5.3%. The net impact of changes in consolidation, mainly as a result of the acquisitions in the United States of PureOlogy, Beauty Alliance, Maly’s West, Columbia Beauty Supply, CollaGenex Pharmaceuticals, and in Turkey of Canan, amounted to +1.8%. Currency fluctuations had a negative impact of -5.5%. Growth excluding the exchange rate impact was +7.1%.

. The news release of July 17th 2008 details the activity of the cosmetics divisions and the geographic zones for the first half of 2008. This news release is available and can be downloaded from the site.

The table of cosmetics sales by division and by geographic zone is provided in the annexe.


Consolidated profit and loss account,
from sales to operating profit

In €m30.06.2007As % of sales31.12.2007 As % of sales
Sales 8,514.3100%17,062.6100%
Cost of sales-2,428.428.5%-4,941.029.0%
Gross profit6,085.971.5%12,121.671.0%
R&D expenses-272.43.2%-559.93.3%
Advertising & promotion expenses-2,599.130.5%-5,126.7 30.0%
Selling general and administrative expenses -1,777.320.9%-3,618.2 21.2%
Foreign exchange gains3.8-10.40.1%
Operating profit1,440.916.9%2,827.216.6%
In €m30.06.2008 As % of salesGrowth
A constant
exchange rates
Sales8,646.3 100%+7.1% +1.6%
Cost of sales-2,505.329.0%  
Gross profit6,141.1 71.0%  
R&D expenses-272.03.1%  
Advertising & promotion expenses - 2,570.129.7%  
Selling general & administrative expenses -1,829.4 21.2%  
Foreign exchange gains28.1-  
Operating profit1,497.7 17.3%+8.5% +3.9%

*based on constant translation rates:

 2008 data at 2008 rates / 2007 data at 2008 rates


Gross profit amounted to € 6,141m, at 71% of sales. Gross profit as a percentage of sales was unchanged against the year 2007 and slightly down compared with 2007 first half. After allocating exchange gains which are related to gross profit, and excluding US professional hair salon distributors acquired since 2007 -whose operating structure is very different to that of the Group- gross profit from half-year to half-year would have fallen slightly by approximately 10 basis points. This very limited decrease in a difficult environment is evidence of the impact of product value enhancement and continuing productivity efforts.


Research and Development expenses represented 3.1% of sales.


Advertising and Promotion expenses came out at € 2,570m. In 2008 first half, they accounted for 29.7% of sales, compared with 30.5% for 2007 first half. This half-year to half-year decrease comes down to 30 basis points when the structural impact of US professional hair salon distributors is taken into account. This item also benefited from continuing productivity and purchasing efforts.


Selling, General and Administrative expenses amounted to € 1,829m, accounting for 21.2% of sales, which is identical to that of the year 2007 and slightly higher than that of the first half of 2007.


After allowing for a foreign exchange gain of € 28m, operating profit totalled € 1,498m. This is up +8.5% at constant exchange rates and +3.9% based on reported figures. It totalled 17.3% of sales, up 40 basis points compared with the first half of 2007.

Operating profit by branch and division

 June 30th 2007June 30th 2008
 €m% of sales€m% of sales
By operational division    
Professional Products(1)245.621.3%263.021.1%
Consumer Products879.920.6%920.321.4%
Luxury Products350.319.1%354.119.6%
Active Cosmetics177.924.8%179.724.3%
Cosmetics divisions total1,651.4 20.6%1,713.7 21.1%
Cosmetics branch1,425.8 17.8%1,477.4 18.2%
The Body Shop1.40.4%0.40.1%
Dermatology branch(3)13.78.6%19.911.2%
Group1,440.9 16.9%1,497.9 17.3%

(1) excluding US professional hair salon distributors: from 22.3% in the first half of 2007 to 22.6% in the first half of 2008.

(2) Non-allocated = Central group expenses. fundamental research expenses. stock option expenses and miscellaneous items. As % of total sales.

(3) Group Share: ie 50%     


The profitability of the cosmetics Divisions improved, rising from 20.6% of sales in the first half of 2007 to 21.1% in the same period in 2008. 


The profitability of The Body Shop is slightly positive, practically at the same level as 2007. The Body Shop profits are almost entirely made in the second half of each year.


The Dermatology branch Galderma substantially increased profitability during 2008 first half to 11.2%.


Consolidated profit and loss account,
from operating profit to net profit excluding non-recurrent items

In €m 30.06.2007 30.12.200730.06.2008Growth
A constant
exchange rates
Operating profit1,440.92,827.21,497.7 +8.5% +3.9%
Finance costs-75.4-174.5-66.7   
Other financial income (expense)-2.7-7.7-3.1   
Sanofi-Aventis dividends250.4250.4 244.8  
Share in net profit of equity affiliates0.20.1 -  
Profit before tax excluding non-recurrent items1,613.42,895.6 +1,672.6+7.6% +3.7%
Income tax excluding non-recurrents items-431.2-855.5-414.6   
Minority interests-1.1-1.5-1.8   
net profit excluding non-recurrent items after minority interests (1)1,181.12,038.61,256.2 +10.1% +6.4%
Not EPS** (in euro) 1.943.362.11 +12.3% +8.5%
Net profit after minority interests1,177.62,656.01,255.6   
Diluted net EPS after minority interests (€)1.944.382.11   
Diluted average number of shares 607,695,515  606,012,471  595,928,002   

* based on constant translation rates:

 2008 data at 2008 rates / 2007 data at 2008 rates

** Diluted net earnings per share excluding non-recurrent items. after minority interests.

(1) Net profit excluding non-recurrent items after minority interests does not include capital gains and losses on disposals of long-term asset, impairment of assets, restructuring costs, associated tax effects or minority interests.


The cost of net debt totalled 67m, lower than in 2007 despite the increase in interest rates and the ongoing share buy-back plan. This improvement is due to investments from the sale of Sanofi-Aventis shares in November 2007 for 1.5 billion euros.


The dividend received from Sanofi-Aventis for 2007 amounted to € 245m. This stability is due to the sale of Sanofi-Aventis shares in 2007.


Profit before tax excluding non-recurrent items amounted to € 1,673m, an increase of +7.6% at constant exchange rates and up +3.7% for reported figures.


Income tax excluding non-recurrent items amounted to € 415m. Tax rate fell from 26.7% during 2007 first half to 24.8% during 1st half 2008. This reduction is due to lower tax rates in certain countries, to an increase in the R&D tax credit, and to the outcome of tax disputes.


Net profit after minority interests amounted to € 1,256m.


Net profit excluding non-recurrent items after minority interests totalled € 1,256m up by +10.1% at constant exchange rates and up +6.4% for reported figures, compared with 2007 first half. After allowing for the positive impact of share buybacks, EPS amounted to € 2.11, up by + 12.3% at constant exchange rates and by +8.5% based on reported figures.



Cash flow Statements/Balance sheet


Gross cash flow amounted to € 1,534m, an increase of +5.4%. This increase is in line with the rate of earnings growth.


Net debt totalled 4.52 billion euros at June 30 th, 2008 as compared to 4.46 billion euros at June 30th 2007.


The balance sheet structure is solid. Shareholders' equity represents 49% of total assets. The decline in this figure compared with December 31st 2007 reflects the lower market capitalisation of Sanofi-Aventis, but also the dividend payout, the share buybacks and the negative conversion rates of the net situation in subsidiaries resulting from significant exchange fluctuations.


Yves Saint Laurent Beauté was acquired on June 30th 2008, impacting the total of assets and debts by an amount of € 1,107m.


"This news release does not constitute an offer to sell, or a solicitation of an offer to buy L'Oréal shares. If you wish to obtain more comprehensive information about L'Oréal, please refer to the public documents registered in France with the Autorité des Marchés Financiers, also available in English on our Internet site
This news release 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

Contacts at L'Oréal 

Individual shareholders and market authorities
Mr Jean Régis CAROF
Tel. : +

Financial analysts and institutional investors
Mrs Caroline MILLOT
Tel. : +

Tel. : +

Tél: +

For more information, please contact your bank, broker or financial institution (I.S.I.N. code: FR0000120321), and consult your usual newspapers, and the Internet site for shareholders and investors,, or its mobile version on your cell phone,; alternatively, call +

To read the news release in PDF format

Extracts from the consolidated financial statements