Cosmetics sales provide boost for Henkel as sales and profits are up

By Andrew McDougall

- Last updated on GMT

Related tags Profit

Cosmetics sales provide boost for Henkel as sales and profits are up
Finished goods manufacturer Henkel has posted its first quarter 2012 results, with sales and profitability up in all sectors, with cosmetics more than pulling its weight.

In terms of profitable growth the Cosmetics and Toiletries business sector continued its long-term upward trend, with sales exceeding the prior-year quarter by 4.9 per cent, reaching €861 million.

In a weak market environment characterized by persistently high competitive activity, organic sales rose once again with an increase of 4.0 percent.

According to the Schwarzkopf hair care maker, this solid sales performance was supported by all regions.

Emerging market jackpot

As with many finished goods manufacturers, the strongest momentum came from the emerging markets, particularly the Africa/Middle East region and the growth markets in Asia, which achieved double-digit growth.

The mature markets saw a continuation of their upward trend, with further growth being especially achieved in Western Europe, despite a weak market environment.

Adjusted operating profit in the Cosmetics/Toiletries business sector once again improved substantially compared to the prior-year quarter, with an increase of 9.3 per cent to €124 million.

"Henkel had a good start to the fiscal year in spite of a challenging and volatile market environment. We achieved solid organic growth and substantially improved our profitability,"​ said Henkel CEO Kasper Rorsted.

Business as a whole

"All of our business sectors contributed to this achievement. Once again our emerging markets registered a strong development. Thus, we are confident of achieving our targets for 2012."

For the fiscal year 2012, Rorsted stated: "We expect that volatility and uncertainty will continue to influence our markets. Therefore, we will continue to adapt our structures and processes so that we can respond more quickly and flexibly than our competitors."

Overall, Henkel's sales in the first quarter of 2012 were at €4,008 million, an increase of 4.8 per cent compared to the figure for the prior-year quarter.

Organic sales, which exclude the impact of foreign exchange and acquisitions/divestments, again rose by 4.7 per cent, a solid increase compared to the prior-year quarter.