L’OCCITANE (00973) FY2022 NP hits record, OP Margin the highest level since listing October 31, 2022 73

PSR Recommendation: BUY Status: Initiation
Target Price: HKD24.89

Company Profile
L’OCCITANE is an international group that manufactures and retails beauty and well-being
products that are rich in natural and organic ingredients, through its brands — L’OCCITANE
en Provence, Melvita, Erborian, L’OCCITANE au Brésil, LimeLife by Alcone, ELEMIS, Sol de
Janeiro and Grown Alchemist. As at 31 March 2022, the Company has more than 3068 retail
outlets (a decrease of 20 or 0.6%). including around 1,500 owned stores, and is present in
90 countries. The total number of own retail stores was 1375 as at 30 June 2022,
representing 115 net closings year to date.
The Company further closed underperforming stores during FY2022, including 21 shops in
the US. At the end of March 2022, the breakdown of the 1,523 own stores by brand and
change over last year were as follows: L’Occitane en Provence (1,354; -35), L’Occitane au
Brésil (65; +1), Melvita (39; -11), Erborian (14; -1) and ELEMIS (18; +13). The number of nonown stores increased by 13 or 0.8%.
net profit for FY2022 hits record high, op margin the highest level since listing
For the FY2022 (at the end of March 2022), the Company’s reported net sales were
€1781.4mn, representing an increase of 15.8% YoY at reported rates. The business
environment continued to improve as countries in Europe and the Americas began to lift the
COVID-19 related restrictive measures. Retail channels saw a strong rebound in footfall
while online channels remained dynamic. Travel retail, spas and cruise ship businesses also
benefited from the comeback of local and international travelers. During the period, net
profit for FY2022 was a record €241.9mn, an increase of 57.5% or €88.3mn as compared to
restated €153.6mn for FY2021, and a 17.4% operating margin, the highest level since listing.
Basic and diluted earnings per share in FY2022 were €0.165 and €0.164 respectively
(FY2021: basic €0.103 and diluted €0.103), an increase of 60.2% and 59.2% respectively.
Dividend payout ratio from 35% to 40%, with a dividend per share that is 78.6% higher than
it was in FY2021.

About the author

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Eric Li
Analyst
Research

李浩然先生(Eric Li) 高級分析師 現任現為輝立証券持牌高級分析師,曾任職股票基金、家族辦公室及證券公司等,擁有多年的證券研究部門從業及投資經驗,並先後於香港最暢銷的財經媒體撰寫投資專欄。畢業於香港理工大學電子計算系。 Eric is currently a licensed research analyst at Phillip Securities. Prior to joining Phillip Securities, he has years of equity research and investment experiences in asset management company, family office and securities company. Meanwhile, he has written investment columns in Hong Kong`s best-selling financial media for years. He holds Bachelor of Arts in Computing from The Hong Kong Polytechnic University.

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