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Written by: Staff
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Paris, Aug 31: L'Oreal, the world's biggest cosmetics group, posted a forecast-beating 19.6 percent rise in first-half operating profits on Thursday and predicted another year of double-digit percentage growth in earnings per share.

The maker of Elseve shampoos, Lancome perfumes and cosmetics products advertised by film stars such as Scarlett Johansson and Penelope Cruz made an operating profit of 1.33 billion euros ($1.71 billion) in the first six months, up from 1.12 billion in the same period of 2005.

This came well above the median forecast of 1.25 billion euros given by analysts polled by Reuters.

L'Oreal had already reported its half-year revenues rose 8.7 percent to 7.8 billion euros, thanks to better sales in western Europe and high growth rates in Latin America and eastern Europe.

''Although once again it is important to emphasise that the significance of half-year figures is limited, the quality of these results and the prospects of sustained growth in the second half mean that we are very confident of achieving another year of double-digit earnings per share growth in 2006,'' Jean-Paul Agon, who replaced Lindsay Owen-Jones as chief executive in April, said in a statement.

Net attributable profit came in at 1.09 billion euros, up from 892 million last year and also topping a median forecast of 1.02 billion. Net earnings per share rose 25.2 percent year on year to 1.76 euros.

The operating margin widened to 17.1 percent from 15.6 percent in the first half of 2005. Analysts had expected a margin of 16 percent.

L'Oreal's results follow a better than forecast 15 percent rise in operating profit at Nivea cream maker Beiersdorf.

L'Oreal shares, which closed at 80.10 euros on Wednesday, have risen 26.7 percent since the start of the year, while the DJ Stoxx European personal and household goods sector index is up 8.4 percent.

The company was due to hold a news conference at 0830 GMT.

Reuters

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