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Henkel achieves strong organic sales growth of 5.9%
07 Aug '08
5 min read
Business Sector Performance:
Organic sales for the Laundry & Home Care business sector increased by a good 3.9 percent. At 1,012 million euros, sales overall were 1.1 percent below the previous year. Foreign exchange had a negative impact of 4.7 percent.
Operating profit decreased from 111 million euros to 96 million euros, reflecting in particular the ongoing increase in raw material prices that lead to a substantial rise in input costs. Despite the price increases implemented by Henkel and measures taken to reduce costs and improve efficiency, the company was not yet able to completely offset these additional expenses.
Organic growth in the Laundry segment was primarily due to results in Eastern Europe. Here, both the company's heavy-duty detergents and its fabric softeners posted a positive sales performance. The good sales growth in North America was due to the high level of market acceptance of the change-over to ultra concentrates, and to the successful launch of Purex Natural Elements. This innovation with mainly natural ingredients is in line with consumers' growing environmental awareness.
Organic sales of the Home Care segment underwent a substantial increase with the greatest impetus again coming from Eastern Europe. The main contributors to this sales improvement were Henkel's dishwashing detergents and WC cleaning and hygiene products. There was also an increase in air freshener sales in North America, once again contributing to an overall positive performance.
With strong organic sales growth of 5.9 percent, the Cosmetics/Toiletries business sector was able to maintain the highly positive trend of the last few quarters, with all regions contributing. In addition to an extremely positive development in North America, the businesses in Eastern Europe and Latin America also generated particularly strong growth.
Compared to the prior-year quarter, nominal sales rose by 1.2 percent to 779 million euros, with growth after adjusting for foreign exchange rising to 5.8 percent. Despite rising material costs, operating profit increased by 8.3 percent after adjusting for foreign exchange, outstripping the rise in sales. Hence, the EBIT margin also improved to 12.8 percent.
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Organic sales for the Laundry & Home Care business sector increased by a good 3.9 percent. At 1,012 million euros, sales overall were 1.1 percent below the previous year. Foreign exchange had a negative impact of 4.7 percent.
Operating profit decreased from 111 million euros to 96 million euros, reflecting in particular the ongoing increase in raw material prices that lead to a substantial rise in input costs. Despite the price increases implemented by Henkel and measures taken to reduce costs and improve efficiency, the company was not yet able to completely offset these additional expenses.
Organic growth in the Laundry segment was primarily due to results in Eastern Europe. Here, both the company's heavy-duty detergents and its fabric softeners posted a positive sales performance. The good sales growth in North America was due to the high level of market acceptance of the change-over to ultra concentrates, and to the successful launch of Purex Natural Elements. This innovation with mainly natural ingredients is in line with consumers' growing environmental awareness.
Organic sales of the Home Care segment underwent a substantial increase with the greatest impetus again coming from Eastern Europe. The main contributors to this sales improvement were Henkel's dishwashing detergents and WC cleaning and hygiene products. There was also an increase in air freshener sales in North America, once again contributing to an overall positive performance.
With strong organic sales growth of 5.9 percent, the Cosmetics/Toiletries business sector was able to maintain the highly positive trend of the last few quarters, with all regions contributing. In addition to an extremely positive development in North America, the businesses in Eastern Europe and Latin America also generated particularly strong growth.
Compared to the prior-year quarter, nominal sales rose by 1.2 percent to 779 million euros, with growth after adjusting for foreign exchange rising to 5.8 percent. Despite rising material costs, operating profit increased by 8.3 percent after adjusting for foreign exchange, outstripping the rise in sales. Hence, the EBIT margin also improved to 12.8 percent.
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Henkel
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