DCF and valuation parameters Page 23 D SOTP and segment analyses L’Oréal: segment analysis • The two main divisions of L’Oréal are Consumer Products and L’Oréal Luxe, accounting together for 76% of the group’s revenues and 90% of the EBIT. In particular, the L’Oréal Luxe division accounts for 28% of the total sales in FY14A. • This division is expected to register a sales growth at a CAGR of 7.8% over the 2013A-17E period when its operating income is anticipated to grow from €1.17b to s er €1.65b (or at a CAGR of 8.9%) over the same period. aluationt ame ar • The L’Oréal Luxe division will remain one of the biggest divisions within L’Oréal. p DCF and v Sales breakdown FY13A–FY17E (in €b) EBIT breakdown FY13A–FY17E (in €b) EBIT margin FY13A-FY17E 25% 20% 20% 21% 21% 21% 30 27.6 4.9 20% 26.3 4% 4.6 18% 18% 18% 25.1 4% 6 4.4 2% 17% 18% 25 22.1 22.5 4% 7% 3.9 2% 4% 7% 3.8 2% 10% 10% 4% 7% CAGR 5 2% 10% CAGR 15% 7% 7% 29% 7.8% 2% 8.9% 20 28% 28% 9% 10% 34% 4 33% 33% 27% 28% 15 31% 33% 10% CAGR 3 CAGR 4.6% 5.5% 10 48% 47% 47% 2 56% 55% 56% 49% 48% 58% 56% 5% 5 1 13% 13% 14% 13% 13% 16% 16% 15% 15% 15% 0 0 0% (16%) (16%) (15%) (15%) (15%) 2013A 2014A 2015E 2016E 2017E -1 L’Oréal Luxe Total cosmetics 2013A 2014A 2015E 2016E 2017E 2013A 2014A 2015E 2016E 2017E Professional Products Consumer Products Professional Products Consumer Products L’Oréal Luxe Active Cosmetics L’Oréal Luxe Active Cosmetics Body Shop Eliminations Body Shop Source: Analyst research H2 2014 The luxury and cosmetics financial factbook 2015