Oriflame, a direct selling company headquartered in Sweden, announced its fourth quarter and full year 2021 financial results. Included in the report was a sales decline of 12% in 2021, although this drop was significantly less in the fourth quarter than in the third. Adjusted EBITDA also decreased, which was impacted by lower sales and increased inflation, but offset by lowered marketing and administrative expenses.
Euro sales in the fourth quarter decreased by 10% and local currency sales decreased by 12%. Costs of sales increased by 14% during this period. Adjusted EBITDA dipped 16.2% or €42.6 million during the quarter and was negatively impacted by lower sales and gross margins.
Online sales reigned supreme in the fourth quarter, making up 98% of all order volume placed. Of these orders, 36% were placed using the Oriflame app and 84% of all visits came from a mobile device. Skin care (25%) was the category leader for the company during the quarter with fragrance (23%) following closely behind.
In full-year 2021, sales were €1,016.5 million compared with €1,156.9 million in 2020. All markets experienced a decline in Euro sales: Latin America 4%, CIS 10%, Europe 5%, Turkey & Africa 25% and Asia 21%.
Cost of sales was down by 11% in 2021 to €324.7 million in 2021, with increased inventory provisions making an impact on the company’s gross margin.
Adjusted EBITDA in 2021 increased by 6% to €188.9 million. This boost came as a result of lower selling and marketing expenses and lower administrative costs. Adjusted EBITDA margin was 18.6%.
The company’s long-term debt at the end of 2021 amounted to €735.6 million, excluding capitalized front-end fees. Cash and cash equivalents were €118.9 million.