The world's biggest cosmetics group L'Oreal posted a 13.5 percent rise in 2003 profit on Friday, its 19th consecutive year of double-digit growth, helped by product launches and strength in emerging markets.
The company whose make-up and haircare products can be found on bathroom shelves around the world said in a statement that 2003 net operating profit - which excludes goodwill and exceptional items - rose to 1.65 billion euros ($2.1 billion) from 1.46 billion a year ago.
It did better than analysts' forecasts for 1.61 billion.
Last year L'Oreal battled an economic slowdown and adverse currency movements, while war in Iraq forced it to skew its product launches towards the first and fourth quarters of the year.
But its performance was helped by what Chairman Lindsay Owen-Jones called "spectacular progress" in emerging markets as well as by innovation, new products and tight cost controls.
L'Oreal gave no immediate forecast for 2004, but analysts predicted that a global economic pickup would help the firm.
The stock, which has climbed 4.5 percent since January but lagged non-cyclical rivals by 1.2 percent, was down 1.8 percent at 67.70 euros at 0909 GMT, the worst performing stock in the sector index.
Less closely watched group net profit rose 16.8 percent to 1.49 billion euros, against forecasts for 1.47 billion.
The maker of Maybelline and Lancome make-up, Fructis and L'Oreal haircare products, and Biotherm skincare lotions reported a 6.7 percent gain in operating profit, after currency effects and provisions, to 1.96 billion euros. Analysts had forecast operating profit of 1.94 billion.
Sales fell 1.8 percent, knocked by a strong euro, to 14.03 billion euros, producing an operating margin of 14 percent versus 12.9 percent a year earlier.
SANOFI BOOST: Equity affiliates, which includes the company's 19.5 percent stake in drug maker Sanofi, contributed 420 million euros, or 25.4 percent, to net operating profit, L'Oreal said.
If Sanofi completes its bid to take over larger rival Aventis, L'Oreal's stake will halve and it will lose that earnings contribution and consolidate only Sanofi's dividends.
L'Oreal has recently streamlined its ownership structure with its two main shareholders, billionaire heiress Liliane Bettencourt and Swiss food giant Nestle. Subject to shareholder approval, the change should strengthen L'Oreal's defences against any potential take-over.
On a regional basis, Western Europe turned in the best operating margin, at 14.8 percent, followed by North America with 12.9 percent and the rest of the world, 10.2 percent.
The group is proposing to raise its dividend 14.1 percent to 0.73 euros.
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