LOREAL_Registration_Document_2017

1 Presentation of the Group Integrated report

GOOD GROWTH MOMENTUM FOR SHARED, LASTING DEVELOPMENT*

The Board of Directors’ meeting, held at the close of the s Annual General Meeting, decided, pursuant to the authorisation voted by the Annual General Meeting on 20 April 2016, on the cancellation of 2,846,604 L’Oréal shares acquired within the scope of the share buyback programme decided by the Board of Directors on 9 February 2017. The shares were cancelled on 31 May 2017. The share capital of L’Oréal at 30 June 2017 amounts to 111,993,452 euros, divided into 559,967,260 shares, each with a par value of 0.2 euro. On 20 April 2017, L’Oréal announced the appointment of s Mr Nicolas Hieronimus as Deputy CEO, in charge of Divisions. Mr Nicolas Hieronimus will also continue in his role as President of the L’Oréal Luxe Division. On 2 May 2017, L’Oréal USA announced the acquisition of s key assets from Four Star Salon Services, a full-service wholesale distributor of products to hair salons in New York, New Jersey and Connecticut. This acquisition will provide SalonCentric with expanded distribution coverage in the United States. On 7 September 2017, after obtaining the necessary s authorisations from the relevant authorities, L’Oréal and Natura Cosmeticos finalised the definitive agreement for the sale of The Body Shop to Natura, in accordance with the terms of the project announced on 9 June 2017. On 19 September 2017, L’Oréal was awarded the second prize s for Diversity in Senior Management Bodies at the Corporate Governance Grand Prix ceremony organised by l'AGEFI. On 21 September 2017, L’Oréal was awarded first prize for its s Code of Ethics at the Labrador Grands Prix de la Transparence ceremony. On 9 October 2017, the OECD (Organisation for Economic s Co-operation and Development) announced that it had accepted two new methods, developed by L’Oréal’s Research laboratories, which can be used in place of animal testing to assess skin allergy and eye irritation. On 20 October 2017, L’Oréal announced a strategic s partnership with STATION F, the world’s largest start-up campus, to support the development of early stage digital beauty start-ups. On 20 November 2017, at the 5 th edition of the “Palmarès de s la féminisation des instances dirigeantes” organised by Ethics & Boards, L’Oréal’s commitment to both gender equality and professional equality was recognised, and L’Oréal received the Award for Gender Equality at Top Management Level.

On 21 November 2017, at the CDP (1) Europe Awards in s Brussels, L’Oréal obtained for the second year running the best possible score, an “A” rating, in each of the three fields of combating climate change, sustainable water stewardship and protecting forests. Significant events that have occurred since the beginning of 2018 No significant event has occurred since the beginning of 2018. 2018 prospects As for 2018, in a market that should remain dynamic and contrasted, L’Oréal more than ever before has the best advantages in terms of innovation, brand power, digital prowess, and the quality of its teams all over the world, to win market share and strengthen its Beauty leadership. L'Oréal is therefore confident that, this year once again, it will outperform the market and achieve significant growth in like-for-like sales and an increase in profitability. L’Oréal’s investment policy responds 1.3.1.5. to long-term objectives L’Oréal is an industrial company which develops chiefly through two types of investment: scientific investments and investments in equipment which 1. are explained at length in several sections of this document (see in particular section 1.2.5. and section 1.2.6.); marketing investments which are made on an ongoing 2. basis and are inherent to the Group’s activities in the cosmetics industry. To capture new market share, in-depth research tailored to each situation must be conducted, and advertising and promotional expenses need to be attuned to the familiarity of the brands and their competitive position in each country. Lastly, investments in point-of sale (POS) advertising materials ensure optimal presence for our brands in points of sale. For reasons relating to strategy and competition, L’Oréal cannot therefore provide any systematic information on future investments. In 2017, the Group’s investments totalled €1,264 million, or 4.9% of its sales. This level reflects the Group’s constant efforts in terms of improving industrial efficiency, research and digital development performance and enhancing brand value.

CDP is an independent international organisation which assesses companies' environmental performance. (1)

REGISTRATION DOCUMENT / L'ORÉAL 2017

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