L’Oréal, value creation champion

L’Oréal ranked second among major French companies on economic profitability in the ranking by the magazine Le Revenu.

According to the newspaper, "Year after year L'Oréal demonstrates a clear positive gap between its economic viability and its cost of capital. Its defensive status is well-merited." The ranking includes all CAC 40 companies, excluding banking Groups. With a "value creation" ratio - return on capital deployed on cost of capital - of 18.2%, L'Oreal is one of six companies that have a ratio above 10%. Eight companies in the ranking are considered "value-destructive." "This excellence ratio certainly reflects the high level of its results, but also the success of a strategy that focuses more on internal growth than on excessively costly large-scale acquisitions of Groups of competitors," The Revenue concludes.