Earnings Release • Feb 7, 2019
Earnings Release
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The gross margin increased significantly and, after strong investments in research, innovation, and business drivers, the operating margin set a new record at 18.3% of sales.
More than ever, it's the strength of L'Oréal's business model, robust and well-balanced, covering all circuits, all categories, all price points and addressing all consumers, that enables the Group to seize opportunities wherever they are. All over the world, our teams are alert and listening to consumers' needs and desires. They adapt and allocate resources with great agility, always in the pursuit of excellence. This is how L'Oréal delivers profitable and sustainable growth, and strengthens its position as the cosmetics market leader year after year.
And finally, in 2018, L'Oréal was recognised once again for its leadership in corporate environmental and social responsibility, notably by the CDP which identified L'Oréal, for the third consecutive year, as a world leader in sustainable development, with three 'A' scores for the management of climate change, water security and forests. L'Oréal has also been acknowledged for its commitment to gender equality, and was named number 1 in Europe for gender parity by Equileap. In terms of ethics, L'Oréal remains exemplary, and is ranked number 1 worldwide by the ethical reputation index Covalence EthicalQuote.
In an economic context that remains volatile and uncertain, we are confident, thanks to our innovations, powerful brands, digital excellence and in particular our outstanding teams all over the world, that we can pursue our corporate social responsibility commitments, outperform the beauty market in 2019 and achieve another year of growth in both sales and profits."
The Board of Directors will propose to the Annual General Meeting of 18 April 2019 the renewal of the tenure as director of Ms Sophie Bellon for a term of four years.
The Board will propose to the Annual General Meeting the candidacy of Ms Fabienne Dulac, Deputy CEO of the Orange Group, Chief Executive Director of Orange France, as a new independent director.
If the Annual General Meeting approves the proposed renewal of tenure and candidacy, the number of independent directors will be 8 out of 14, representing an independent director ratio of 57%. The number of women on the Board of Directors will be 7 out of 14 directors appointed by the Annual General Meeting, which corresponds to a women's representation rate of 50%5 .
5 The two directors representing employees are not taken into account in calculating these percentages, in accordance with the AFEP-MEDEF Code.
Like-for-like, i.e. based on a comparable scope of consolidation and constant exchange rates, the sales growth of the L'Oréal group was +7.1%.
The net impact of changes in the scope of consolidation amounted to +0.9%.
Growth at constant exchange rates was +8.0%.
At the end of 2018, currency fluctuations had a negative impact of -4.5%.
Based on reported figures, the Group's sales, at 31 December 2018, amounted to 26.9 billion euros, an increase of +3.5%.
| 4 | th quarter 2018 | At 31 December 2018 | ||||
|---|---|---|---|---|---|---|
| Growth | Growth | |||||
| €m | Like-for-like | Reported | €m | Like-for-like | Reported | |
| By Division | ||||||
| Professional Products | 857.2 | +3.5% | +3.1% | 3,262.5 | +2.0% | -2.6% |
| Consumer Products | 3,041.7 | +2.8% | +4.5% | 12,032.2 | +2.5% | -0.7% |
| L'Oréal Luxe | 2,651.5 | +14.7% | +15.3% | 9,367.2 | +14.4% | +10.6% |
| Active Cosmetics | 523.0 | +11.9% | +10.7% | 2,275.5 | +11.9% | +9.2% |
| Group total | 7,073.4 | +7.7% | +8.6% | 26,937.4 | +7.1% | +3.5% |
| By Geographic Zone | ||||||
| Western Europe | 2,075.1 | +0.9% | +1.3% | 8,065.1 | -0.3% | -0.7% |
| North America | 1,849.2 | +2.2% | +5.0% | 7,234.3 | +2.7% | -1.6% |
| New Markets, of which: | 3,149.1 | +16.5% | +16.5% | 11,638.1 | +16.1% | +10.3% |
| - Asia Pacific | 2,063.3 | +26.2% | +29.3% | 7,405.6 | +24.1% | +20.4% |
| 6 - Latin America |
463.4 | -2.8% | -5.1% | 1,784.8 | -0.4% | -8.6% |
| - Eastern Europe | 454.2 | +9.1% | +1.0% | 1,754.2 | +9.1% | +0.2% |
| 7 - Africa, Middle East |
168.2 | -2.7% | -1.1% | 693.5 | +4.9% | +0.2% |
| Group total | 7,073.4 | +7.7% | +8.6% | 26,937.4 | +7.1% | +3.5% |
6 The Group has applied the IAS 29 accounting rule (Financial Reporting in Hyperinflationary Economies) to Argentina from 1 July 2018 onwards. The negative impact of this adjustment amounts to 200 basis points on like-for-like growth in Latin America and to 10 basis points on the growth of the whole L'Oréal group in the full-year 2018.
7 The application of the IFRS 15 accounting rule from 1 January 2018 has resulted in the restatement of sales with distributors when they operate as agents and not on their own behalf. The impact of this restatement amounted to 7.6 million euros on the sales of the Africa, Middle East Zone in the fourth quarter of 2018. The effect of this accounting method on the profit and loss account and the balance sheet is not material.
The Professional Products Division ended the year at +2.0% like-for-like and -2.6% reported.
The year was marked by renewed dynamism in this Division, which accelerated in the fourth quarter. All geographic Zones are growing, except for Western Europe. The return to growth in the United States and Brazil has been confirmed. Momentum was maintained in the Asia Pacific Zone, driven by India and China, and in Eastern Europe.
Haircare is benefiting from the strong growth of Kérastase, combining the success of Resistance Extentioniste and Fusio-Dose customised in-salon haircare with the roll-out of a selective multi-channel strategy. Dynamism in hair colour is being driven by Shades EQ by Redken, which recorded another year of growth, the success of the SoColor Cult launch at Matrix and the good performance of Dia at L'Oréal Professionnel.
The Consumer Products Division posted fourth quarter growth of +2.8% like-for-like, and ended the year at +2.5% like-for-like and -0.7% reported.
The Division's three major brands are growing. L'Oréal Paris and Maybelline New York are maintaining their very good annual momentum, and Garnier accelerated in the fourth quarter.
Skincare is growing strongly, with double-digit growth worldwide in facial skincare, thanks to the excellent performance of Revitalift Filler by L'Oréal Paris, Garnier tissue masks and Men Expert skincare. Makeup growth continues, driven especially by Maybelline New York and the global success of Superstay Matte Ink and Fit Me!. In haircare there were two very successful launches: Elseve Dream Lengths and Fructis Hair Food.
The Division is facing ongoing difficulties in Western Europe, where the market remains sluggish, and in Brazil. It is winning market share in the United States and Eastern Europe, and continuing to accelerate sharply in Asia, thanks in particular to China and India.
E-commerce4 continues to show strong growth.
L'Oréal Luxe sales grew by +14.4% like-for-like and +10.6% reported, with a second half at +15.1% like-for-like. The Division outperformed the market and made 2018 a historic year.
The Division's four billionaire brands are posting double-digit growth. Lancôme is being driven by its skincare performance, with franchises Génifique and Absolue, and the undisputed success of La Vie est Belle. Yves Saint Laurent and Giorgio Armani had a very good year in fragrances, with Black Opium, Y, Sì Passione and Acqua di Giò Absolu, and in foundations. Kiehl's is benefiting from the acceleration in skincare, with an excellent performance from Line-Reducing Concentrate. The successful development of IT Cosmetics and Atelier Cologne is continuing.
L'Oréal Luxe is winning market share in Asia Pacific, particularly in China where growth is double-digit. The Division performed well in dynamic markets in Travel Retail, Eastern Europe and Latin America. In Western Europe and Africa, Middle East, it is outperforming more difficult markets.
Meanwhile, the Division continues to accelerate in e-commerce4 .
The Division continues to win market share across all geographic Zones at a rapid pace, with growth remaining strong in North America and in Asia.
All the major brands are contributing to the Division's growth. La Roche-Posay ended the year with doubledigit growth, driven by its anti-wrinkle innovation Hyalu B5, and core franchises Anthelios and Effaclar, and is performing well across all Zones. Growth at Vichy is again bolstered by the success of Minéral 89, the star product of 2018. SkinCeuticals is posting very strong growth in all Zones, and strengthening its number 1 position in professional skincare in the United States. CeraVe is recording double-digit growth in North America, and has now been rolled out in more than 30 countries.
E-commerce4 is accelerating sharply, and accounts for more than 13% of the Division's sales.
The Zone recorded sales growth in the fourth quarter, and ended the year at -0.3% like-for-like, and -0.7% reported. In 2018, Western Europe was affected by the sluggishness of some markets, such as France and the United Kingdom, and by a slowdown in the makeup category.
L'Oréal Luxe is outperforming its market, thanks to the dynamism of Lancôme, Giorgio Armani and Kiehl's, and the same is true of the Active Cosmetics Division, thanks to the rapid growth of La Roche-Posay and the CeraVe roll-out. The Consumer Products Division is strengthening its positions in makeup, reflecting the good results of the Maybelline New York and Essie brands, and more recently in skincare, thanks to L'Oréal Paris anti-ageing products and Garnier cleansing.
The Zone posted growth of +2.7% like-for-like and -1.6% reported.
The Consumer Products Division remains on track, and increased its market share in the makeup and hair colour segments, thanks to strong performances by the L'Oréal Paris, Maybelline New York and Essie brands. In luxury, skincare is a highly dynamic segment, with the Kiehl's and IT Cosmetics brands outperforming the market. L'Oréal Luxe is also growing faster than its market in the fragrance category. In the Professional Products Division, growth is driven by the Redken and Matrix brands, and by the acquisition of Pulp Riot. The upturn in the sales of the iconic Kérastase brand is also worth noting. The Active Cosmetics Division posted a good performance close to 20% with its brands CeraVe, SkinCeuticals, La Roche-Posay and Vichy, which are all delivering double-digit growth.
Asia Pacific: Growth in this Zone came out at +24.1% like-for-like and +20.4% reported. All four Divisions are winning market share. The dynamism of Chinese consumers, combined with the good performance of premium brands and rapid growth in several other South-East Asian markets as well as in Travel Retail, were the Zone's main growth drivers. The four Divisions posted robust fourth-quarter figures, thanks to the success of Singles' Day (11/11) sales in China. The acquisition of Stylenanda in June strengthened the Group's position in the Zone.
Latin America: The Zone is at -0.4% like-for-like and -8.6% reported. The L'Oréal Luxe and Active Cosmetics Divisions are posting strong growth, and winning market share. In Brazil, the Professional Products Division is growing strongly, while the performance of the Consumer Products Division reflects ongoing challenges, but improved in the second half. The adjustment on 1 July to allow for hyperinflation in Argentina had a negative impact of -2.0% like-for-like on the Zone's annual growth.
Eastern Europe: In this Zone growth amounted to +9.1% like-for-like and +0.2% reported. Growth was driven by all four Divisions, but especially by Active Cosmetics. Across the individual countries, Turkey, Ukraine, Romania and Czech Republic posted very dynamic growth. E-commerce4 is growing very quickly, by more than 50%.
Africa, Middle East: The Zone recorded growth of +4.9% like-for-like and +0.2% reported, despite the unfavourable geopolitical context and sluggish markets, especially in the Middle East. Egypt and Morocco posted good growth, and all Divisions increased their market share. There was positive development in South Africa and Kenya, thanks in particular to the Consumer Products Division and the launch of the Mixa bodycare range.
Audited financial statements, certification in progress.
Consolidated profit and loss accounts: from sales to operating profit.
| 2017 | 2018 | ||||
|---|---|---|---|---|---|
| €m | % sales €m |
% sales | |||
| Sales | 26,023.7 | 100.0% | 26,937.4 | 100.0% | |
| Cost of sales | -7,359.2 | 28.3% | -7,331.6 | 27.2% | |
| Gross profit | 18,664.5 | 71.7% | 19,605.8 | 72.8% | |
| R&D expenses | -877.1 | 3.4% | -914.4 | 3.4% | |
| Advertising and promotion expenses | -7,650.6 | 29.4% | -8,144.7 | 30.2% | |
| Selling, general and administrative expenses | -5,460.5 | 21.0% | -5,624.7 | 20.9% | |
| Operating profit | 4,676.3 | 18.0% | 4,922.0 | 18.3% |
Gross profit, at 19,605 million euros, came out at 72.8% of sales, compared with 71.7% in 2017, which is an improvement of 110 basis points.
Research and Development expenses, at 914 million euros, have increased by 4.3%.
As announced, advertising and promotion expenses increased to 30.2% of sales, representing an increase of 80 basis points.
Selling, general and administrative expenses, at 20.9% of sales, have been reduced by 10 basis points.
Overall, operating profit has grown by +5.3% to 4,922 million euros, and amounts to 18.3% of sales, representing an increase of 30 basis points.
| 2017 | 2018 | |||
|---|---|---|---|---|
| €m | % sales | % sales | ||
| By Division | ||||
| Professional Products | 669.4 | 20.0% | 651.5 | 20.0% |
| Consumer Products | 2,419.0 | 20.0% | 2,428.1 | 20.2% |
| L'Oréal Luxe | 1,855.8 | 21.9% | 2,072.4 | 22.1% |
| Active Cosmetics | 471.2 | 22.6% | 523.0 | 23.0% |
| Divisions total | 5,415.4 | 20.8% | 5,675.0 | 21.1% |
| 8 Non-allocated |
-739.1 | -2.8% | -753.1 | -2.8% |
| Group | 4,676.3 | 18.0% | 4,922.0 | 18.3% |
The profitability of the Consumer Products Division came out at 20.2%, an improvement of 20 basis points compared with 2017.
The profitability of L'Oréal Luxe, at 22.1%, increased by 20 basis points.
The profitability of the Active Cosmetics Division came out at 23.0%, representing an increase of 40 basis points.
Non-allocated expenses amounted to 753 million euros, which is stable in relative value.
| 2017 | 2018 | ||||
|---|---|---|---|---|---|
| Operating profit | €m % sales €m |
% sales | |||
| Western Europe | 1,860.4 | 22.9% | 1,682.5 | 20.9% | |
| North America | 1,411.3 | 19.2% | 1,430.0 | 19.8% | |
| New Markets | 2,143.6 | 20.3% | 2,562.5 | 22.0% | |
| Geographic Zones total9 | 5,415.4 | 20.8% | 5,675.0 | 21.1% |
Profitability in Western Europe came out at 20.9%, 200 basis points lower than last year.
In North America, profitability came out at 19.8%, an increase of 60 basis points compared with 2017. And in the New Markets, profitability increased by 170 basis points compared to the previous year, and
amounted to 22.0% of sales.
8 Non-allocated = Central Group expenses, fundamental research expenses, free grant of shares expenses and miscellaneous items. As a % of sales.
9 Before non-allocated.
Consolidated profit and loss accounts: from operating profit to net profit excluding non-recurring items.
| €m | 2017 | 2018 | Growth |
|---|---|---|---|
| Operating profit | 4,676.3 | 4,922.0 | +5.3% |
| Financial revenues and expenses excluding dividends received | -22.9 | -1.9 | |
| Sanofi dividends | 350.0 | 358.3 | |
| Profit before tax excluding non-recurring items | 5,003.3 | 5,278.4 | +5.5% |
| Income tax excluding non-recurring items | -1,250.5 | -1,286.8 | |
| Net profit excluding non-recurring items of equity consolidated companies |
-0.1 | +0.1 | |
| Non-controlling interests | -3.9 | -4.1 | |
| Net profit excluding non-recurring items after non-controlling interests |
3,748.710 | 3,987.6 | +6.4% |
| EPS11 (€) | 6.65 | 7.08 | +6.5% |
| Net profit after non-controlling interests | 3,581.4 | 3,895.4 | +8.8% |
| Diluted EPS after non-controlling interests (€) | 6.36 | 6.92 | |
| Diluted average number of shares | 563,528,502 | 563,098,506 |
Finance expenses came out at approximately 1.9 million euros.
Sanofi dividends amounted to 358 million euros.
Income tax excluding non-recurrent items amounted to 1,286 million euros, representing a tax rate of 24.4%.
Net profit excluding non-recurring items after non-controlling interests from continuing operations amounted to 3,987 million euros, an increase of +6.4%, and +10% at constant exchange rates. Earnings per Share, at 7.08 euros, is up by +6.5%.
Non-recurring items after non-controlling interests12 amounted to -92 million euros net of tax.
Net profit came out at 3,895 million euros, an increase of +8.8%.
Gross cash flow amounted to 5,178 million euros, an increase of 4.1%.
The working capital requirement decreased by 113 million euros.
At 1,416 million euros, investments represented 5.3% of sales.
Net cash flow13 at 3,875 million euros, is down slightly after a strong increase in the previous year.
The balance sheet is particularly solid, with shareholders' equity amounting to 26.9 billion euros, and net cash at 2,751 million euros at 31 December 2018.
The Board of Directors has decided to propose to the shareholders' Annual General Meeting of 18 April 2019 a dividend of 3.85 euros per share, an increase of +8.5% compared with the dividend paid in 2018. The dividend will be paid on 30 April 2019 (ex-dividend date 26 April 2019 at 0:00 a.m., Paris time).
www.loreal-finance.com - Follow us on Twitter @loreal 9
10 Net profit, excluding non-recurring items after non-controlling interests, from continuing operations.
11 Diluted earnings per share, based on net profit, excluding non-recurring items, after non-controlling interests, from continuing operations.
12 Non-recurring items include impairment of assets, net profit of discontinued operations, restructuring costs and tax effects of nonrecurring items.
13 Net cash flow = Gross cash flow + changes in working capital - capital expenditure.
At 31 December 2018, the capital of the company is formed by 560,396,652 shares, each with one voting right.
"This news release does not constitute an offer to sell, or a solicitation of an off er to buy L'Oréal shares. If you wish to obtain more comprehensive information about L'Oréa l, please refer to the public documents registered in France with the Autorité des Marchés Financiers, also available in English on our Internet site www.loreal-finance.com.
This news releas e may contain some forward-looking statements. Although the Company considers that these statements are based on reasonable hypot heses at the dat e of publication of this release, they are by their nature subject to risks and uncertainties which could cause actual results to differ mat erially from those indicated or projected in these stat ements."
This is a free translation int o English of the 2018 Annual Results news release issued in the French language and is provided solely for t he convenience of English speaking readers. In case of discrepancy, the French version prev ails.
Contacts at L'ORÉAL (Switchboard: +33 1 47 56 70 00)
Individual shareholders Financial analysts and
Tel: +33 1 47 56 83 02 Tel: +33 1 47 56 86 82 Tel: +33 1 47 56 76 71
and market authorities Institutional investors Journalists
Mr Jean Régis CAROF Mrs Françoise LAUVIN Mrs Stephanie CARSON-PARKER [email protected] [email protected] [email protected]
For more information, please contact your bank, broker or financial institution (I.S.I.N. code: FR0000120321), and consult yo ur usual newspapers, the Internet site for shareholders and investors, www.loreal-finance.com or the L'Oréal Finance app, alternatively, call +33 1 40 14 80 50.
| 2017 14 | 2018 | |
|---|---|---|
| First quarter: | ||
| Operational Divisions | 6,847.8 | 6,778.6 |
| The Body Shop | 197.2 | |
| First quarter total | 7,045.0 | 6,778.6 |
| Second quarter: | ||
| Operational Divisions | 6,564.2 | 6,612.1 |
| The Body Shop | ||
| Second quarter total | 6,564.2 | 6,612.1 |
| First half: | ||
| Operational Divisions | 13,411.9 | 13,390.7 |
| The Body Shop | ||
| First half total | 13,411.9 | 13,390.7 |
| Third quarter: | ||
| Operational Divisions | 6,097.9 | 6,473.3 |
| The Body Shop | ||
| Third quarter total | 6,097.9 | 6,473.3 |
| Nine months: | ||
| Operational Divisions | 19,509.9 | 19,864.0 |
| The Body Shop | ||
| Nine months total | 19,509.9 | 19,864.0 |
| Fourth quarter: | ||
| Operational Divisions | 6,513.8 | 7,073.4 |
| The Body Shop | ||
| Fourth quarter total | 6,513.8 | 7,073.4 |
| Full year: | ||
| Operational Divisions | 26,023.7 | 26,937.4 |
| The Body Shop | ||
| Full year total | 26,023.7 | 26,937.4 |
www.loreal-finance.com - Follow us on Twitter @loreal 11 14 In the first quarter 2017, reported Group sales included The Body Shop sales, which amounted to 197.2 million euros.
| € millions | 2018 | 2017 (1) |
2016 (1) |
|---|---|---|---|
| Net sales | 26,937.4 | 26,023.7 | 24,916.3 |
| Cost of sales | 7,331.6 | 7,359.2 | 7,068.6 |
| Gross profit | 19,605.8 | 18,664.5 | 17,847.7 |
| Research and development | 914.4 | 877.1 | 841.2 |
| Advertising and promotion | 8,144.7 | 7,650.6 | 7,264.4 |
| Selling, general and administrative expenses Operating profit |
5,624.7 4,922.0 |
5,460.5 4,676.3 |
5,236.0 4,506.1 |
| Other income and expenses | 94.7 | 276.3 | 541.3 |
| Operational profit | 4,827.3 | 4,400.0 | 3,964.8 |
| Finance costs on gross debt | 34.8 | 35.5 | 27.4 |
| Finance income on cash and cash equivalents | 47.9 | 38.5 | 39.0 |
| Finance costs, net | 13.1 | 3.1 | 11.6 |
| Other financial income (expenses) | 15.0 | 26.0 | 25.8 |
| Sanofi dividends Profit before tax and associates |
358.3 5,183.7 |
350.0 4,727.0 |
346.5 4,297.1 |
| Income tax | 1,284.3 | 901.3 | 1,213.7 |
| Share of profit in associates | 0.1 | 0.1 | 0.1 |
| Net profit from continuing operations | 3,899.5 | 3,825.6 | 3,083.4 |
| Net profit from discontinued operations | - | -240.1 | 25.3 |
| Net profit | 3,899.5 | 3,585.5 | 3,108.7 |
| Attributable to: | |||
| owners of the company | 3,895.4 | 3,581.4 | 3,105.8 |
| non controlling interests Earnings per share attributable to owners of the company (euros) |
4.1 6.96 |
4.1 6.40 |
2.9 5.55 |
| Diluted earnings per share attributable to owners of the company (euros) | 6.92 | 6.36 | 5.50 |
| Earnings per share of continuing operations attributable to owners | |||
| of the company (euros) | 6.96 | 6.83 | 5.51 |
| Diluted earnings per share of continuing operations attributable to owners of the company (euros) |
6.92 | 6.78 | 5.46 |
| Earnings per share of continuing operations attributable to owners of the company, excluding non recurring items (euros) |
7.13 | 6.70 | 6.47 |
| Diluted earnings per share of continuing operations attributable | |||
| to owners of the company, excluding non recurring items (euros) | 7.08 | 6.65 | 6.41 |
(1) The consolidated income statements for 2017 and 2016 are presented to reflect the impacts of IFRS 5 regarding discontinued operations, restating The Body Shop activity on a single line "Net profit from discontinued operations".
| € millions | 2018 | 2017** | 2016* |
|---|---|---|---|
| Consolidated net profit for the period | 3,899.5 | 3,585.5 | 3,108.7 |
| Financial assets available-for-sale | - | -597.1 | -201.0 |
| Cash flow hedges | -60.3 | 88.9 | -124.0 |
| Cumulative translation adjustments | 126.4 | -824.8 | 19.6 |
| Income tax on items that may be reclassified to profit or loss (1) (2) | 14.8 | 4.5 | 86.3 |
| Items that may be reclassified to profit or loss | 80.9 | -1,328.5 | -219.1 |
| Financial assets at fair value through profit or loss | 450.5 | - | - |
| Actuarial gains and losses | -58.5 | 280.0 | -1.3 |
| Income tax on items that may not be reclassified to profit or loss (1) (2) | 0.5 | -107.9 | -39.3 |
| Items that may not be reclassified to profit or loss | 392.5 |
-
| € millions | 31.12.2018 | 31.12.2017 | (1) 31.12.2016 (1) (2) |
|---|---|---|---|
| Non-current assets | 25,991.2 | 24,320.1 | 25,584.6 |
| Goodwill | 9,597.1 | 8,872.3 | 8,792.5 |
| Other intangible assets | 3,087.3 | 2,579.1 | 3,179.4 |
| Property, plant and equipment | 3,624.6 | 3,571.1 | 3,756.9 |
| Non current financial assets Investments in associates |
9,100.5 9.0 |
8,766.2 1.1 |
9,306.5 1.0 |
| Deferred tax assets | 572.7 | 530.3 | 548.3 |
| Current assets | 12,466.3 | 11,019.0 | 10,045.6 |
| Inventories | 2,821.9 | 2,494.6 | 2,698.6 |
| Trade accounts receivable | 3,983.2 | 3,923.4 | 3,941.8 |
| Other current assets | 1,509.1 | 1,393.8 | 1,420.4 |
| Current tax assets | 160.1 | 160.6 | 238.8 |
| Cash and cash equivalents TOTAL |
3,992.0 38,457.5 |
3,046.6 35,339.1 |
1,746.0 35,630.2 |
| € millions | 31.12.2018 | 31.12.2017 | (1) 31.12.2016 (1) (2) |
|---|---|---|---|
| Equity | 26,933.6 | 24,818.5 | 24,504.0 |
| Share capital | 112.1 | 112.1 | 112.4 |
| Additional paid in capital | 3,070.3 | 2,935.3 | 2,817.3 |
| Other reserves | 15,952.5 | 14,761.8 | 13,961.9 |
| Other comprehensive income | 4,242.1 | 3,895.0 | 4,227.3 |
| Cumulative translation adjustments | 287.4 | 413.5 | 410.9 |
| Treasury stock | 56.5 | 56.5 | 133.6 |
| Net profit attributable to owners of the company | 3,895.4 | 3,581.4 | 3,105.8 |
| Equity attributable to owners of the company | 26,928.4 | 24,815.7 | 24,501.9 |
| Non controlling interests | 5.2 | 2.8 | 2.1 |
| Non-current liabilities | 1,412.2 | 1,347.2 | 1,918.9 |
| Provisions for employee retirement obligations and related benefits | 388.9 | 301.9 | 711.8 |
| Provisions for liabilities and charges | 336.1 | 434.9 | 333.3 |
| Deferred tax liabilities | 673.7 | 597.0 | 842.9 |
| Non current borrowings and debt | 13.5 | 13.4 | 30.9 |
| Current liabilities | 10,111.6 | 9,173.4 | 9,207.3 |
| Trade accounts payable Provisions for liabilities and charges |
4,550.0 979.8 |
4,140.8 889.2 |
4,135.3 810.7 |
| Other current liabilities | 3,138.9 | 2,823.9 | 2,854.4 |
| Income tax | 215.1 | 158.5 | 173.2 |
| Current borrowings and debt | 1,227.8 | 1,161.0 | 1,233.7 |
| TOTAL | 38,457.5 | 35,339.1 | 35,630.2 |
(1) The balance sheets at 31 December 2017 and 31 December 2016 have been restated to reflect the change in accounting policies resulting from the application of IFRS 9 "Financial Instruments".
(2) 2016 balance sheets as published including The Body Shop.
| € millions | outstanding | capital | capital | profit | income | shares | adjustments | company | interests | equity |
|---|---|---|---|---|---|---|---|---|---|---|
| At 31.12.15 | 559,988,178 | 112.6 | 2,654.4 | 16,170.8 | 4,517.5 | -233.3 | 391.9 | 23,613.9 | 3.1 | 23,617.0 |
| Changes in accounting policies at 01.01.2016 | 10.0 | 10.0 | ||||||||
| At 01.01.2016 (1) Consolidated net profit for the period |
559,988,178 | 112.6 | 2,654.4 | 16,180.8 3,105.8 |
4,507.5 | -233.3 | 391.9 | 23,613.9 3,105.8 |
3.1 2.9 |
23,617.0 3,108.7 |
| Financial assets available-for-sale | -159.3 | -159.3 | -159.3 | |||||||
| Cash flow hedges | -79.3 | -79.3 | -0.1 | -79.4 | ||||||
| Cumulative translation adjustments | 19.0 | 19.0 | 0.6 | 19.6 | ||||||
| Other comprehensive income that may be reclassified to profit and loss |
-238.6 | 19.0 | -219.6 | 0.5 | -219.1 | |||||
| Actuarial gains and losses | -40.6 | -40.6 | -40.6 | |||||||
| Other comprehensive income that may not be reclassified to profit and loss |
-40.6 | -40.6 | - | -40.6 | ||||||
| Consolidated comprehensive income | 3,105.8 | -279.2 | 19.0 | 2,845.6 | 3.4 | 2,849.0 | ||||
| Capital increase Cancellation of Treasury shares Dividends paid (not paid on Treasury shares) Share based payment |
2,074,893 | 0.4 0.6 |
162.8 | 498.9 1,741.9 120.4 |
499.5 | 163.2 1,741.9 120.4 |
3.4 | 163.2 1,745.2 120.4 |
||
| Net changes in Treasury shares Purchase commitments for non controlling interests Changes in scope of consolidation Other movements At 31.12.2016 (1) |
1,964,675 560,098,396 |
112.4 | 2,817.3 | 99.3 0.8 1.6 17,067.6 |
1.0 4,227.3 |
399.8 -133.6 |
410.9 | 499.1 0.8 0.6 24,501.9 |
0.1 0.9 0.1 2.1 |
499.1 0.1 1.7 0.5 24,504.0 |
| Consolidated net profit for the period | 3,581.4 | 3,581.4 | 4.1 | 3,585.5 | ||||||
| Financial assets available-for-sale | -559.7 | -559.7 | -559.7 | |||||||
| Cash flow hedges | 55.5 | 55.5 | 0.4 | 55.9 | ||||||
| Cumulative translation adjustments | -824.5 | -824.5 | -0.3 | -824.8 | ||||||
| Other comprehensive income that may be reclassified to profit and loss |
-504.2 | -824.5 | -1,328.7 | 0.1 | -1,328.6 | |||||
| Actuarial gains and losses | 172.1 | 172.1 | 172.1 | |||||||
| Other comprehensive income that may not | ||||||||||
| be reclassified to profit and loss | 172.1 | 172.1 | - | 172.1 | ||||||
| Consolidated comprehensive income Capital increase Cancellation of Treasury shares |
1,509,951 | 0.3 0.6 |
118.0 | 3,581.4 498.6 |
-332.2 | 499.2 | -824.5 | 2,424.8 118.3 |
4.1 | 2,428.9 118.3 |
| Dividends paid (not paid on Treasury shares) Share based payment Net changes in Treasury shares Changes in scope of consolidation Other movements |
1,860,384 | 1,857.7 128.8 77.2 1.3 0.3 |
422.0 | 1,857.7 128.8 499.2 1.3 0.2 |
3.5 | 1,861.2 128.8 499.2 1.3 0.2 |
||||
| At 31.12.2017 (1) | 559,747,963 | 112.1 | 2,935.3 | 18,343.3 | 3,895.0 | -56.5 | -413.5 | 24,815.7 | 2.8 | 24,818.5 |
(1) Taking into account the change in accounting policies resulting from the application of IFRS 9 "Financial Instruments".
| AT 31.12.2018 | 559,625,527 | 112.1 | 3,070.3 | 19,847.8 | 4,242.1 | -56.5 | -287.4 | 26,928.4 | 5.2 | 26,933.6 |
|---|---|---|---|---|---|---|---|---|---|---|
| Net changes in Treasury shares Changes in scope of consolidation Other movements |
2,497,814 | 2.9 3.4 |
0.1 | 499.4 | 499.4 2.9 3.3 |
2.9 | 499.4 3.3 |
|||
| Cancellation of Treasury shares Dividends paid (not paid on Treasury shares) Share based payment |
0.5 | 498.9 2,006.6 126.4 |
499.4 | 2,006.6 126.4 |
3.8 | 2,010.4 126.4 |
||||
| Consolidated comprehensive income Capital increase |
2,375,378 | 0.5 | 135.0 | 3,895.4 0.2 |
347.2 | 126.1 | 4,368.7 135.3 |
4.2 | 4,372.9 135.3 |
|
| Other comprehensive income that may not be reclassified to profit and loss |
392.5 | 392.5 | - | 392.5 | ||||||
| Actuarial gains and losses | -44.0 | -44.0 | -44.0 | |||||||
| be reclassified to profit and loss Financial assets at fair value through profit or loss |
-45.3 436.5 |
126.1 | 80.8 436.5 |
0.1 | 80.9 436.5 |
|||||
| Hyperinflation Other comprehensive income that may |
11.6 | 11.6 | 11.6 | |||||||
| Cumulative translation adjustments | 114.5 | 114.5 | 0.3 | 114.8 | ||||||
| Cash flow hedges | -45.3 | -45.3 | -0.2 | -45.5 | ||||||
| At 01.01.2018 (2) Consolidated net profit for the period |
559,747,963 | 112.1 | 2,935.3 | 18,331.3 3,895.4 |
3,895.0 | -56.5 | -413.5 | 24,803.7 3,895.4 |
1.9 4.1 |
24,805.6 3,899.5 |
| At 31.12.2017 (1) Changes in accounting policies at 01.01.2018 |
559,747,963 | 112.1 | 2,935.3 | 18,343.3 12.0 |
3,895.0 | -56.5 | -413.5 | 24,815.7 12.0 |
2.8 0.9 |
24,818.5 12.9 |
| € millions | outstanding | capital | capital | profit | income | shares | adjustments | company | interests | equity |
(1) Taking into account the change in accounting policies resulting from the application of IFRS 9 "Financial Instruments".
(2) Taking into account the change in accounting policies resulting from the application of IFRS 15 "Revenue from contracts with customers".
| € millions | 2018 | 2017 (1) |
2016 (1) |
|---|---|---|---|
| Cash flows from operating activities | |||
| Net profit attributable to owners of the company | 3,895.4 | 3,581.4 | 3,105.8 |
| Non controlling interests | 4.1 | 4.1 | 2.9 |
| Elimination of expenses and income with no impact on cash flows: | |||
| depreciation, amortisation and provisions | 1,109.3 | 1,218.5 | 1,382.3 |
| changes in deferred taxes | 43.0 | 194.8 | 86.5 |
| share based payment (including free shares) | 126.4 | 126.7 | 120.4 |
| capital gains and losses on disposals of assets | 2.7 | 3.9 | 16.2 |
| Other operations without effect on cash and cash equivalents | 2.7 | ||
| Net profit from discontinued operations Share of profit in associates net of dividends received |
0.1 | 240.1 0.1 |
25.3 0.1 |
| Gross cash flow | 5,178.1 | 4,972.2 | 4,656.4 |
| Changes in working capital | 113.8 | 261.1 | 4.3 |
| Net cash provided by operating activities from discontinued operations | 36.7 | 43.9 | |
| Net cash provided by operating activities (A) | 5,291.9 | 5,196.6 | 4,704.7 |
| Cash flows from investing activities | |||
| Purchases of property, plant and equipment and intangible assets | 1,416.1 | 1,263.5 | 1,334.9 |
| Disposals of property, plant and equipment and intangible assets | 5.6 | 8.2 | 34.2 |
| Changes in other financial assets (including investments in non consolidated companies) | 61.0 | 70.7 | 42.9 |
| Effect of changes in the scope of consolidation | 666.5 | 166.5 | 1,209.0 |
| Net cash (used in) from investing activities from discontinued operations | 24.4 | 51.8 | |
| Net cash (used in) from investing activities (B) | -2,016.0 | -1,516.9 | -2,604.5 |
| Cash flows from financing activities | |||
| Dividends paid Capital increase of the parent company |
2,061.4 135.3 |
1,870.7 118.3 |
1,832.9 163.2 |
| Disposal (acquisition) of Treasury shares | 499.4 | 499.2 | 499.1 |
| Purchase of non controlling interests | 2.0 | ||
| Issuance (repayment) of short term loans | 62.3 | 86.6 | 446.0 |
| Issuance of long term borrowings | 1.8 | ||
| Repayment of long term borrowings | 4.3 | 7.0 | 16.4 |
| Net cash (used in) from financing activities from discontinued operations | 71.5 | 3.5 | |
| Net cash (used in) from financing activities (C) | -2,367.5 | -2,275.7 | -1,740.8 |
| Net effect of changes in exchange rates and fair value (D) | 36.9 | 65.3 | 13.1 |
| Change in cash and cash equivalents (A+B+C+D) | 945.4 | 1,338.7 | 346.2 |
| Cash and cash equivalents at beginning of the year (E) | 3,046.6 | 1,746.0 | 1,399.8 |
| Net effect of changes in cash and cash equivalents of discontinued operations (F) | 38.1 | ||
| CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR (A+B+C+D+E+F) | 3,992.0 | 3,046.6 | 1,746.0 |
(1) The consolidated statement of cash flows for 2017 and 2016 are presented to reflect the impacts of IFRS 5 regarding discontinued operations.
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