LOREAL_Registration_Document_2017

2017 Consolidated Financial Statements* NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

b) Other operation On 9 June 2017, L’Oréal announced, following an extensive review of the strategic options for The Body Shop to ensure its best future development, having received a firm offer from Natura Cosmeticos SA to acquire The Body Shop and has entered into exclusive discussions with Natura. The sale contract to Natura Cosmeticos SA was signed on 27 June 2017. After obtaining the necessary authorisations from the competent authorities, L'Oréal and Natura Cosmeticos SA finalised the definitive agreement to sell The Body Shop to Natura on 7 September 2017, in accordance with the terms of the project communicated on 9 June 2017 (note 2.3.). On 4 January 2016, L’Oréal USA announced the signing of an agreement to acquire key assets from Raylon Corporation, a fullservice wholesale distributor of salon professional products. The acquisition will expand SalonCentric’s distribution coverage of salon professional products in Pennsylvania, New Jersey, Delaware, and portions of Maryland, West Virginia and New York, representing approximately 3,500 salons. This acquisition has been fully consolidated since 26 February 2016. On 30 June 2016, L'Oréal announced the signature of an agreement to acquire Atelier Cologne. Launched in 2009, Atelier Cologne specialised in niche perfumery sold in selected retailers. This operation was finalised on 25 July 2016. This acquisition has been fully consolidated since 25 July 2016. On 13 July 2016, L'Oréal has submitted a firm offer to Rivadis group for the acquisition of the Société des Thermes de Saint-Gervais-les-Bains and licence to use the Saint-Gervais Mont-Blanc brand. Based on this offer, the Rivadis group has granted exclusive negotiation rights to L'Oréal. This operation was finalised early-November and has been fully consolidated since 1 November 2016. On 22 July 2016, L’Oréal announced the signing of a definitive agreement to acquire IT Cosmetics, one of the fastest growing prestige beauty brands in the United States for a cash purchase price of US $1.2 billion. For last 12 months prior to the acquisition, IT Cosmetics had net sales of US $182 million. Founded by Jamie Kern Lima and Paulo Lima and co-owned by TSG Consumer Partners, IT Cosmetics was developed with leading plastic surgeons to provide women with innovative, problem-solving skincare and makeup products that empower them to feel confident and beautiful. This operation was finalised on 31 August 2016. This acquisition has been fully consolidated since 31 August 2016. Year 2016 2.1.2. Acquisitions

The cost of these new acquisitions amounted to €1,238.8 million. The total amount of goodwill and other intangible assets resulting from the acquisitions amounted to €932.5 million and €286.3 million, respectively. In 2016, these acquisitions represented €224.5 million in full-year net sales and €51.5 million in full-year operating profit.

Year 2015 2.1.3. a) Acquisitions

On 8 September 2014, L’Oréal announced that it had signed an agreement to acquire Niely Cosmeticos. Founded in 1981 by Daniel Fonseca de Jesus, Niely Cosmeticos is the largest independent hair colouration and hair care company in Brazil, one of the world’s largest hair colour and hair care markets. With a net revenue of 406 million Brazilian Reals (€130 million) in 2014, the Niely Cosmeticos Group has two main brands: Cor & Ton for hair colouration and Niely Gold for shampoos and care. Furthermore, Niely Cosmeticos has industrial and logistical facilities in Nova Iguaçu, in the State of Rio. The approval granted by the local regulatory authorities was confirmed in early January 2015. On 31 March 2015, L’Oréal finalised the acquisition of Niely Cosmeticos. This acquisition has been fully consolidated since 1 April 2015. On 3 February 2015, The Body Shop announced the completion of the deal to acquire the assets of Adidem Pty Limited, the Company operating The Body Shop Australia since 1983. This acquisition will move the fifth biggest The Body Shop market’s retail sales from a Franchise operation to a Company-Owned market. This acquisition has been fully consolidated since 2 February 2015. The cost of these new acquisitions amounted to €380.5 million. The total amount of goodwill and other intangible assets resulting from the acquisitions was €348.0 million and €24.5 million, respectively. These acquisitions represent around €183.1 million in full-year net sales and €0.9 million in full-year operating profit. b) Other operation In late November 2014, L’Oréal and Nestlé announced their intention to end the operations of their joint venture Innéov. On 24 April 2015, Nestlé Skin Health announced that Galderma, its company focused on medical solutions, would acquire certain assets of Innéov Group to serve as the foundation for its entry into the nutraceutical market. This operation was finalised on 30 June 2015.

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REGISTRATION DOCUMENT / L'ORÉAL 2017

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