Beiersdorf profits up and emerging markets hold the key for 2013

By Andrew MCDOUGALL

- Last updated on GMT

Beiersdorf profits up and emerging markets hold the key for 2013

Related tags: Board of directors, Beiersdorf

Nivea skin care maker Beiersdorf reported an increase in profits for full year 2012 with all of its core brands showing strong growth, and will continue to focus on success in the emerging markets going forward.

The German firm reported a 14 per cent rise in 2012 profit, having already posted a 4.7 per cent rise in 2012 sales in January as markets like Russia and Brazil helped counter a weak climate in Europe.

Emerging market focus

Chief Executive Officer Stefan Heidenreich, who joined the company at the start of last year, said the company will now focus on China, Brazil and Russia as it introduces new products to help keep revenue growing as the weak climate in Europe continues.

Sales from emerging markets now account for almost 50 per cent of the company’s total revenue.

On the back of the results, Beiersdorf also said that it expected to grow sales faster than the market in 2013 and that its EBIT margin, which stood at 12.2 per cent at the end of 2012, would grow in the next two years.

The cosmetics company’s core brands; Nivea, Eucerin, and La Prairie, all saw strong organic growth, with the former achieving growth of 6.4 per cent worldwide.

Strengthening brands

Looking ahead, Heidenreich said, "We will systematically continue the path set out in the Blue Agenda, our strategic compass. The focus remains on strengthening our brands - first and foremost NIVEA - developing innovative products, and extending our presence in emerging markets."

Under Heidenreich, Beiersdorf is focusing on large innovations and core products to drive growth as part of his “Blue Agenda,” dubbed for the company’s trademark Nivea packaging.

Earlier this year, the brand underwent a redesign based around the classic blue tin​ from the 1920s incorporating the blue Nivea colour and white Bauhaus lettering onto the capos and closures of its packaging.

It aims to provide some consistency to a brand that had slightly ‘lost its way’ according to executive board member Ralph Gusko, as well as keep in line with the company’s goal of reducing its carbon footprint; the new packs are also recyclable and use 15 per cent less material.

Heidenreich also last year dropped singer Rihanna in advertising as he vowed to return the brand to its roots, which include values such as trust and care.

Related topics: Business & Financial, East Asia, China

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