In Brief: L’Oreal Acquires IT Cosmetics, Provides Microbeads Update; More

With its $1.2bn cash purchase of IT Cosmetics, L’Oreal S.A. picks up more than 300 “high performance” beauty products, including makeup and skin-care items, brushes and tools, which will be wrapped into its leading Luxe Division, according to a July 22 announcement. With distribution through home shopping portals including QVC and The Shopping Channel, as well as specialty stores ULTA and Sephora and the brand’s website, IT Cosmetics’ recorded $182m in sales during the 12-period ended June 2016, an increase of 56% compared with the prior year, L’Oreal says, characterizing IT as “one of the fastest-growing prestige beauty brands in the US.” The French beauty giant says IT will “perfectly complement” its existing brand portfolio “to satisfy the rising demand for makeup as well as hybrid skincare,” and will continue to operate out of its Jersey City, N.J. headquarters under the current leadership team. Luxe sales drove L’Oreal’s Q1 performance, increasing 4.4%, reported, to reach €1.75bn (Also see "L'Oreal Kicks Off FY 2016 With Consumer Biz Acceleration, NA Share Gains" - HBW Insight, 4 May, 2016.).

Separately, L’Oreal provided an update July 20 on its efforts to phase out plastic microbeads from rinse-off products, an initiative first announced in 2014 in response to rising environmental concerns. According to the firm, 80% of relevant products have been reformulated, and 100% will be plastic microbead-free by the end of 2016. The US Microbead-Free Waters Act, signed into law in late 2015, requires cosmetics manufacturers to stop producing rinse-off products containing plastic microbeads for cleansing or exfoliating purposes by July 1, 2017, and to cease sales of such offerings one year later. Questions have arisen, however, about the viability of certain alternative materials (Also see "The US Microbead Ban: Are There Teeth, And Would PHAs Pass Through?" - HBW Insight, 19 July, 2016.)