L’Occitane International, the well-known cosmetics group behind brands such as L’Occitane en Provence, Melvita, Erborian, and Elemis, has reported a substantial decline in revenue for the first half of the 2020-21 financial year. The company has been deeply impacted by the Covid-19 crisis, as 75% of its 1,569 stores worldwide had to close during the peak of the pandemic. This resulted in a sharp decrease in sales of 15.2%, amounting to €616.6 million (or 13.1% at constant exchange rates).

Between April and September, the operating income of L’Occitane International was €32.89 million, compared to €41.7 million during the same period in the previous year. L’Occitane en Provence, the leading brand that contributes to 75% of the group’s revenue, saw a significant sales decline of 16.7% equating to €462.3 million. The skincare brand Elemis also experienced a decline of 23.2%, resulting in sales of €64.6 million. The “other brands” segment, which includes Melvita and Erborian, faced a decrease in revenue of 25.6%, amounting to €35.2 million.

However, amidst these challenging circumstances, one brand within the group managed to defy the downward trend. LimeLife, a U.S. make-up brand, saw an impressive sales increase of 33.5%, totaling €54.3 million. This growth has been attributed to successful new product launches, flash promotions, and the introduction of a new mobile app.

In France, where L’Occitane International operates 87 stores, revenue for the period reached €37.5 million, down from €48.6 million in the first half of 2019. Despite a decline of 14.7%, the United States remains the company’s main market, generating sales worth €113.9 million. The only region where the group experienced growth was Asia, particularly in China with a substantial increase of 27.1% (€97.4 million), and Taiwan with a rise of 19%.

Notably, L’Occitane witnessed a significant surge in online sales by 80.8% during the first half of the financial year. Looking ahead, the company anticipates ongoing challenges and has announced potential job cuts of 300 employees from its workforce of 9,000. L’Occitane International is currently undergoing a restructuring process for both its Brazilian organization and Melvita, as well as streamlining its retail presence in the U.S.

Useful Links:
1. L’Occitane International Official Website
2. L’Occitane Skincare Products