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Henkel AG & Co. KGaA (HEN3.DE)

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  • EQS Group

    Henkel AG & Co. KGaA:

    DGAP-News: Henkel AG & Co. KGaA / Key word(s): Quarter Results10.11.2020 / 07:31 The issuer is solely responsible for the content of this announcement.Good business performance despite continued difficult market conditions due to theCOVID-19 pandemicHenkel achieves strong organic sales growth in the third quarter- Group sales grow organically by 3.9% to around 5 billion euros; nominal -1.5%- All business units show positive development:      - Adhesive Technologies with positive organic sales growth of 1.3%,         nominal -4.8%       - Beauty Care reports very strong organic sales growth of 4.3%,         nominal 3.0%      - Laundry & Home Care achieves significant organic sales growth of 7.7%,         nominal 0.7%      - Regional sales development shows a differentiated picture:        Emerging markets 8.8%, mature markets 0.6%       - New guidance for fiscal 2020 presented in OctoberDüsseldorf, November 10, 2020 - Henkel delivered strong organic sales growth of 3.9 percentin the third quarter of fiscal 2020 - despite the continued challenging economic environment as a result of the COVID-19 pandemic. Group sales totaled around 5 billion euros, corresponding to a nominal change of -1.5 percent. At the beginning of October, Henkel published preliminary figures for its sales performance in the third quarter and presented its new guidance for fiscal 2020."The impacts of the global coronavirus crisis continue to determine the market environment. Nevertheless, Henkel achieved a good business performance in the third quarter, with all three business units contributing. This is evidence of our robust, diversified portfolio comprised of successful brands and innovative technologies for our customers in the industrial and consumer goods businesses. Furthermore, our additional investments in marketing, innovation and digitalization are paying off. Plus, we significantly expanded our digital sales in the third quarter, increasing their total sales share to more than 15 percent," said Henkel CEO, Carsten Knobel."The good performance in the third quarter is also partly due to catch-up effects from the second quarter, where the negative impacts of the COVID-19 pandemic were particularly severe. But above all, it is the result of our strong global team, which in this unprecedented and challenging time for all of us, is showing enormous commitment as it continues to contribute to the long-term success of Henkel."Henkel performed well in this challenging market environment in the third quarter. The Adhesive Technologies business unit was able to record a recovery in demand across all business areas compared to the second quarter and achieved positive organic sales growth overall compared to the same quarter of the previous year. In the Beauty Care business unit, the Hair Salon business also showed a recovery compared to the second quarter. Its organic sales development year on year was, however, slightly negative. Conversely, the retail business achieved very strong organic sales growth compared to the third quarter of 2019. With demand for laundry detergents and household cleaners remaining strong and thanks to catch-up effects from the second quarter, the Laundry & Home Care business unit was able to record significant organic sales growth, and thus continued its successful development."During the coronavirus crisis, we adapted flexibly and quickly to changes while continuing to vigorously pursue the agenda for purposeful growth that we introduced in March this year. With our new full-year guidance, we provided our expectations for our development over the remainder of the year. Although we assume that we will continue to feel the negative impacts of the pandemic in the fourth quarter, we do not expect to see further extensive lockdowns - such as those witnessed in the second quarter - in the core regions essential for Henkel. We are convinced that, with our strategic focus on purposeful growth, we are well positioned to emerge stronger from the crisis," Knobel added.Group sales performanceIn the third quarter of 2020, sales of the Henkel Group decreased nominally by -1.5 percent to 4,999 million euros. Organically (i.e. adjusted for foreign exchange and acquisitions/ divestments), sales increased by 3.9 percent. At Group level, the increase was driven by volume, with price and volume developments differing between the business units. Acquisitions and divestments accounted for an increase of 0.1 percent in sales. Foreign exchange effects had a negative impact of -5.5 percent on the sales performance.In the first nine months of 2020, sales decreased nominally by -4.5 percent to 14,485 million euros. Organically, Henkel registered a negative sales development of -2.1 percent, primarily due to volume effects. Over the first nine months of this year, price trends were only slightly negative. Henkel's business performance was influenced, especially in the first six months of the year, by the negative impacts of the COVID-19 pandemic on its Industrial and Hair Salon businesses in particular. After recording the strongest decline in demand in the second quarter, Henkel's businesses recovered significantly in the third quarter. Group sales performance1         in million euros   Q3/2020   1-9/2020 Sales   4,999   14,485 Change versus previous year   -1.5%   -4.5% Foreign exchange   -5.5%   -2.6% Adjusted for foreign exchange   4.0%   -1.9% Acquisitions/divestments   0.1%   0.2% Organic   3.9%   -2.1% Of which price   0.4%   -0.2% Of which volume   3.5%   -1.9%   1 All individual figures have been commercially rounded. Addition may result in deviations from the totals indicated.  The emerging markets achieved organic sales growth of 8.8 percent in the third quarter. Organic sales development in the mature markets was positive at 0.6 percent. In the Western Europe region, sales declined organically by -1.2 percent year on year. By contrast, we were able to increase sales in the Eastern Europe region by 10.4 percent. In the Africa/Middle East region, we achieved organic sales growth of 13.9 percent in the third quarter of 2020. Organic sales growth was 2.9 percent in the North America region and 13.8 percent in the Latin America region. Organic sales development in the Asia-Pacific region was positive at 1.2 percent. Sales performance by region1 in million euros   Western Europe   Eastern Europe   Africa/ Middle East   North America   Latin America   Asia- Pacific   Corporate   Henkel Group Sales² July- September 2020   1,472   796   301   1,354   273   777   26   4,999 Sales² July- September 2019   1,485   815   325   1,328   299   796   30   5,077 Change versus previous year   -0.9%   -2.3%   -7.2%   1.9%   -8.6%   -2.4%   -   -1.5% Organic   -1.2%   10.4%   13.9%   2.9%   13.8%   1.2%   -   3.9% Proportion of Group sales 2020   29%   16%   6%   27%   5%   16%   1%   100% Proportion of Group sales 2019   29%   16%   6%   26%   6%   16%   1%   100%                                   1 All individual figures have been commercially rounded. Addition may result in deviations from the totals indicated. 2 By location of company.  In the first nine months of 2020, the emerging markets posted organic sales growth of1.3 percent, whereas sales development in the mature markets was negative at -4.4 percent. Sales performance by region1 in million euros   Western Europe   Eastern Europe   Africa/ Middle East   North America   Latin America   Asia- Pacific   Corporate   Henkel Group Sales² January-September 2020   4,322   2,240   956   3,917   792   2,177   81   14,485 Sales² January-September 2019   4,583   2,273   976   3,951   970   2,321   92   15,167 Change versus previous year   -5.7%   -1.4%   -2.0%   -0.9%   -18.4%   -6.2%   -   -4.5% Organic   -5.8%   5.8%   7.4%   -3.2%   -3.7%   -3.8%   -   -2.1% Proportion of Group sales 2020   30%   15%   7%   27%   5%   15%   1%   100% Proportion of Group sales 2019   30%   15%   7%   26%   6%   15%   1%   100%                                   1 All individual figures have been commercially rounded. Addition may result in deviations from the totals indicated. 2 By location of company.  Sales performance Adhesive TechnologiesSales generated by the Adhesive Technologies business unit decreased nominally by-4.8 percent to 2,280 million euros in the third quarter of 2020. Organically (i.e. adjusted for foreign exchange and acquisitions/divestments), sales increased by 1.3 percent. Both volume and price performance were positive. Foreign exchange effects reduced sales by -5.5 percent, and acquisitions/divestments by a further -0.6 percent.In the first nine months of 2020, the Adhesive Technologies business unit recorded a nominal decrease of -9.7 percent in sales to 6,433 million euros. Organically, sales decreased by -6.8 percent, due to volume effects. The COVID-19 pandemic had a severely negative impact on performance in the first and, especially, second quarter. In the third quarter, our business was still adversely affected by a decline in industrial and automotive production. Compared to the second quarter, however, a recovery in demand was recorded across all business areas. Sales performance Adhesive Technologies1         in million euros   Q3/2020   1-9/2020 Sales   2,280   6,433 Proportion of Group sales   46%   44% Change versus previous year   -4.8%   -9.7% Foreign exchange   -5.5%   -2.6% Adjusted for foreign exchange   0.7%   -7.1% Acquisitions/divestments   -0.6%   -0.3% Organic   1.3%   -6.8% Of which price   1.0%   0.4% Of which volume   0.3%   -7.2%   1 All individual figures have been commercially rounded. Addition may result in deviations from the totals indicated.  The individual business areas of the Adhesive Technologies business unit showed a mixed performance in the third quarter. Organic sales development in the Automotive & Metals business area remained below previous year's level. Following a strong decrease in sales in the first half of the year, the business area recovered significantly in the third quarter and improved over the course of the three months. In the Electronics & Industrials business area, the COVID-19 pandemic impacted particularly the Industrials business, which recorded a negative development. By contrast, the Electronics business posted a positive performance. The Packaging & Consumer Goods business area achieved good organic sales development, supported by strong growth in Consumer Goods and very strong growth in Packaging. The Craftsmen, Construction & Professional business area achieved very strong sales growth, driven primarily by double-digit increases in Craftsmen and Professional and very strong growth in Construction. This was partly due to positive catch-up effects after a weaker second quarter.In regional terms, the Adhesive Technologies business unit posted very strong organic sales growth in the emerging markets. Sales increased in the double-digit percentage range in the Latin America and Eastern Europe regions, with significant growth being posted in the Africa/Middle East region. The Packaging & Consumer Goods and the Craftsmen, Construction & Professional businesses were the main contributors to this development. Sales performance remained stable overall in the Asia (excluding Japan) region. Very strong growth in China was not able to offset the negative developments in the other countries in the region.In the mature markets, organic sales performance was below the level of the previous year overall. The Western Europe region was particularly impacted by a negative performance in the Automotive & Metals and Electronics & Industrials businesses with the significant sales growth in Craftsmen, Construction & Professional only partially able to offset the decline. The North America region was also impacted by declining demand in the business areasAutomotive & Metals and Electronics & Industrials. By contrast, the Packaging & Consumer Goods business achieved strong organic sales growth.Sales performance Beauty CareIn the Beauty Care business unit, sales increased nominally by 3.0 percent to 999 million eurosin the third quarter of 2020. Organically (i.e. adjusted for foreign exchange and acquisitions/divestments), sales grew by 4.3 percent. This performance was driven by both volume and price. Foreign exchange effects reduced sales by -3.3 percent. Acquisitions/divestments contributed 2.0 percent to sales growth.In the first nine months of 2020, sales of the Beauty Care business unit were nominally down -3.9 percent year on year, at 2,818 million euros. Organically, sales decreased by -4.2 percent due to volume effects. Following negative developments in the Hair Salon business as a result of the pandemic in the first and, especially, second quarter, the business area saw a significant recovery in the third quarter. After a weaker first six months, sales development in the Branded Consumer Goods business was very strong in the third quarter. Sales performance Beauty Care1         in million euros   Q3/2020   1-9/2020 Sales   999   2,818 Proportion of Group sales   20%   19% Change versus previous year   3.0%   -3.9% Foreign exchange   -3.3%   -1.9% Adjusted for foreign exchange   6.3%   -2.0% Acquisitions/divestments   2.0%   2.2% Organic   4.3%   -4.2% Of which price   1.6%   0.1% Of which volume   2.7%   -4.3%   1 All individual figures have been commercially rounded. Addition may result in deviations from the totals indicated.  The Branded Consumer Goods business achieved very strong organic sales growth in the third quarter. As was the case in the second quarter, the Body Care category recorded double-digit percentage growth. The Dial brand in particular was able to continue its very strong performance from the second quarter. After experiencing negative development in the first half of the year, the Hair Cosmetics category achieved very strong sales growth, driven by organic sales growth in Hair Colorants in the double-digit percentage range. Hair Care also improved significantly and posted a strong sales performance. However, the Styling business performed below prior year due to the change in consumer behavior in the wake of the COVID-19pandemic.Although the Hair Salon business continued to be impacted by the COVID-19 pandemic in the third quarter, it recorded a significant recovery compared to the first six months. Year on year, growth was positive in the Western Europe region and very strong in the Latin America region. Despite negative organic sales development, the other regions still demonstrated a strong improvement in performance compared to the first half of the year.The very strong performance in Branded Consumer Goods and the recovery in the Hair Salon business were also reflected in the regions. The emerging markets achieved strong organic sales growth in the third quarter. This performance was substantially attributable to significant increases in sales in the Eastern Europe and Latin America regions. Asia (excluding Japan) registered positive sales growth. By contrast, the Africa/Middle East region recorded negative sales development.Organic sales development was very strong in the mature markets. Sales growth in the North America region was in the double-digit percentage range due, particularly, to the Body Care category, which also posted double-digit growth. Sales performance was positive in Western Europe, driven by both the Branded Consumer Goods and Hair Salon businesses. Conversely, performance in the mature markets of the Asia-Pacific region was negative,particularly in the Hair Salon business.Sales performance Laundry & Home CareThe Laundry & Home Care business unit generated sales of 1,693 million euros in the third quarter of 2020, corresponding to a nominal increase of 0.7 percent over the prior-year quarter. Organically (i.e. adjusted for foreign exchange and acquisitions/divestments), sales in the business unit increased significantly, by 7.7 percent. Growth was driven primarily by a significant increase in volume, compared to a slightly negative price trend. Acquisitions/divestments had no substantial impact on sales. Foreign exchange effects, by contrast, reduced sales by -7.0 percent.In the first nine months of 2020, sales of the Laundry & Home Care business unit increased nominally by 2.7 percent to 5,153 million euros. Organically, the businesses of this unit achieved very strong sales growth of 5.8 percent, driven by volume. Following a very strong increase in sales in the first and second quarter of the year, the business unit recorded significant growth in the third quarter. Sales performance Laundry & Home Care¹         in million euros   Q3/2020   1-9/2020 Sales   1,693   5,153 Proportion of Group sales   34%   36% Change versus previous year   0.7%   2.7% Foreign exchange   -7.0%   -3.1% Adjusted for foreign exchange   7.7%   5.8% Acquisitions/divestments   0.0%   0.0% Organic   7.7%   5.8% Of which price   -1.1%   -1.2% Of which volume   8.8%   7.0%   1 All individual figures have been commercially rounded. Addition may result in deviations from the totals indicated.  In the Home Care business area, we again - as in the preceding two quarters - achieved organic sales growth in the double-digit percentage range in the third quarter. The strong development of this business area was substantially due to the performance of our brand families Pril, Bref and Somat, all of which posted double-digit increases in the categories dishwashing products, hard surface cleaners, and WC cleaners. This trend was supported both by increased demand for household cleaners as a result of the pandemic and by our successful product innovations.The Laundry Care business area recorded strong growth in the third quarter, to which heavy-duty laundry detergents contributed with a very strong performance. Our core brand Persil achieved significant growth, not least as a result of our innovation initiatives. The detergent caps product group generated double-digit growth, thus extending its successful performance from the first six months. Our North American brand all also achieved sales growth in the double-digit percentage range.In the emerging markets we achieved double-digit organic sales growth in the third quarter, with the Africa/Middle East, Asia (excluding Japan) and Latin America regions particularly prominent. The Eastern Europe region recorded significant organic sales growth.Performance in the mature markets was strong overall. In the North America region, especially, Laundry & Home Care achieved very strong organic sales growth. This development is partially attributable to catch-up effects from the second quarter. Sales development in the Western Europe region was good. Growth in the mature markets of the Asia-Pacific region was in the double-digit percentage range.Net assets and financial position of the GroupCompared to June 30, 2020, there were no substantial changes in the net assets and financial position of the Group in the period under review.Outlook for the Henkel GroupOn April 7, 2020 - as a result of the dynamic spread of the COVID-19 pandemic and the high level of uncertainty about the impact and development of the global economy - the Management Board of Henkel AG & Co. KGaA decided to no longer maintain the forecast for fiscal 2020 that was given in the combined management report for 2019.Based on business development in the first nine months of 2020 and assumptions regarding the business performance in the fourth quarter, the Management Board of Henkel AG & Co. KGaA approved a new outlook for fiscal 2020 on October 9, 2020.Due to the effects of the COVID-19 pandemic, a strongly negative development of the global economy is expected in fiscal 2020. The new outlook is based on the assumption that, in the fourth quarter, industrial demand and business activity in areas of importance to Henkel will be below prior year but will not deteriorate significantly. The decisive factor in this context will be the further development of global infection rates and pandemic-related restrictions. In formulating its guidance, Henkel assumes that, in the core regions essential for the company, there will be no far-reaching lockdowns in the fourth quarter of 2020.Taking these factors into account, the Henkel Group expects organic sales growth ofbetween -1.0 and -2.0 percent in fiscal 2020.For the Adhesive Technologies business unit, which is likely to be significantly impacted by a sharp decline in general industrial demand and, in particular, in the automotive industry, Henkel anticipates organic sales growth in the range between -5.5 and -6.5 percent. For the Beauty Care business unit, Henkel currently anticipates organic sales growth in the range between -2.0 and -3.0 percent. A significant decline in the Hair Salon business due to the pandemic will have an impact on this business unit in the full fiscal year, while growth is anticipated in the Branded Consumer Goods business. For Laundry & Home Care, Henkel expects organic sales growth in the range between +4.5 and +5.5 percent.We expect the contribution to nominal sales growth of the Henkel Group from acquisitions in 2019 and 2020 to be in the low single-digit percentage range. The translation of sales in foreign currencies is expected to have a negative effect in the low to mid-single-digit percentage range.At Group level, Henkel expects to achieve an adjusted return on sales (adjusted EBIT margin) in the range between 13.0 and 13.5 percent. For the Adhesive Technologies business unit, Henkel expects an adjusted EBIT margin in the range between 14.5 and 15.0 percent, for Beauty Care in the range between 10.0 and 10.5 percent and for Laundry & Home Care in the range between 15.0 and 15.5 percent. The decline in sales in the Industrial and the Hair Salon businesses due to the pandemic will have a negative impact on the adjusted EBIT margin. As announced at the beginning of the year, Henkel is also increasing investments in marketing, advertising, digitalization and IT.Adjusted earnings per preferred share (EPS) at constant exchange rates are expected to decline in the range between -18.0 and -22.0 percent.Furthermore, we have the following expectations for 2020:- Restructuring expenses of 250 to 300 million euros- Cash outflows from investments in property, plant and equipment and intangible assets of between 650  and 700 million eurosAbout HenkelHenkel operates globally with a well-balanced and diversified portfolio. The company holds leading positions with its three business units in both industrial and consumer businesses thanks to strong brands, innovations and technologies. Henkel Adhesive Technologies is the global leader in the adhesives market. In its Laundry & Home Care and Beauty Care businesses, Henkel holds leading positions in many markets and categories around the world. Founded in 1876, Henkel looks back on more than 140 years of success. In 2019, Henkel reported sales of more than 20 billion euros and adjusted operating profit of around 3.2 billion euros. Henkel employs more than 52,000 people globally - a passionate and highly diverse team, united by a strong company culture, a common purpose to create sustainable value, and shared values. As a recognized leader in sustainability, Henkel holds top positions in many international indices and rankings. Henkel's preferred shares are listed in the German stock index DAX. For more information, please visit www.henkel.com.This document contains statements referring to future business development, financial performance and other events or developments of future relevance for Henkel that may constitute forward-looking statements. Statements with respect to the future are characterized by the use of words such as "expect", "intend", "plan", "anticipate", "assume", "believe", "estimate", and similar terms. This information contains forward-looking statements which are based on current estimates and assumptions made by the corporate management of Henkel AG & Co. KGaA. Such statements are not to be understood as in any way guaranteeing that those expectations will turn out to be accurate. Future performance and results actually achieved by Henkel AG & Co. KGaA and its affiliated companies depend on a number of risks and uncertainties and may therefore differ materially from the forward-looking statements (both negatively and positively). Many of these factors are outside Henkel's control and cannot be accurately estimated in advance, such as the future economic environment and the actions of competitors and others involved in the marketplace. Henkel neither plans nor undertakes to update forward-looking statements.This document includes supplemental financial indicators that are not clearly defined in the applicable financial reporting framework and that are or may be alternative performance measures. When assessing the net assets, financial position and results of operations of Henkel, these supplemental financial indicators should not be viewed in isolation or as alternatives to the financial indicators presentedin accordance with the applicable financial reporting framework in the Consolidated Financial Statements. Other companies that report or describe similarly titled alternative performance measures may calculate them differently.This document has been issued for information purposes only and is not intended to constitute investment advice or an offer to sell, or a solicitation of an offer to buy, any securities.Financial calendarPublication of Report for Fiscal 2020:Thursday, March 4, 2021Annual General Meeting Henkel AG & Co. KGaA 2021:Friday, April 16, 2021ContactsInvestors & AnalystsLars Korinth Phone: +49 (0) 211 797-1631E-mail: lars.korinth@henkel.comMona Niermann Phone: +49 (0) 211 797-7151E-mail: mona.niermann@henkel.comDorothee Brinkmann Phone: +49 (0) 211 797-5299E-mail: dorothee.brinkmann@henkel.comPress & MediaLars WitteckPhone: +49 (0) 211 797-2606E-mail: lars.witteck@henkel.comWulf KlüppelholzPhone: +49 (0) 211 797-1875E-mail: wulf.klueppelholz@henkel.comJennifer OttPhone: +49 (0) 211 797-2756E-mail: jennifer.ott@henkel.comFurther information containing download material and the link to listen in on the telephone conference are available at:www.henkel.com/presswww.henkel.com/ir10.11.2020 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.The issuer is solely responsible for the content of this announcement.The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Archive at www.dgap.de Language: English Company: Henkel AG & Co. KGaA Henkel Str. 67 40191 Düsseldorf Germany Phone: +49 (0)211 797-0 Fax: +49 (0)211 798-4008 E-mail: press@henkel.com Internet: www.henkel.de ISIN: DE0006048432, DE0006048408 WKN: 604843, 604840 Indices: DAX Listed: Regulated Market in Berlin, Dusseldorf, Frankfurt (Prime Standard), Hamburg, Hanover, Munich, Stuttgart; Regulated Unofficial Market in Tradegate Exchange EQS News ID: 1146812   End of News DGAP News Service

  • EQS Group

    Henkel AG & Co. KGaA: Henkel provides new outlook for fiscal 2020 / Preliminary figures for the third quarter 2020

    Henkel AG & Co. KGaA / Key word(s): ForecastHenkel AG & Co. KGaA: Henkel provides new outlook for fiscal 2020 / Preliminary figures for the third quarter 202009-Oct-2020 / 08:34 CET/CESTDisclosure of an inside information acc. to Article 17 MAR of the Regulation (EU) No 596/2014, transmitted by DGAP - a service of EQS Group AG.The issuer is solely responsible for the content of this announcement.Düsseldorf, 2020-10-09T08:15+02:00 (MESZ)Henkel provides new outlook for fiscal 2020Preliminary figures for the third quarter 2020Based on the business development in the first nine months of 2020 and the current assumptions regarding the business performance in the fourth quarter, the Management Board of Henkel AG & Co. KGaA today approved a new outlook for fiscal 2020.As a result of the dynamic spread of the COVID-19 pandemic and the high level of uncertainty about the impact and development of the global economy in the course of the year, the Management Board of Henkel AG & Co. KGaA had decided on April 7, 2020, to no longer maintain the forecast for fiscal 2020 that was given in the Annual Report 2019.Due to the effects of the COVID-19 pandemic, current forecasts anticipate a strongly negative development of the global economy in 2020. The new outlook is based on the assumption that the industrial demand and business activity in areas of importance to Henkel in the fourth quarter will be below prior year but will not deteriorate significantly. The decisive factor in this context will be the future development of global infection rates and the development of pandemic-related restrictions. In this context, Henkel assumes that there will be no far-reaching lockdowns in the core regions essential for the company in the fourth quarter of 2020.Taking these developments into account, Henkel expects organic sales growth of between -1.0 and -2.0 percent at Group level in fiscal 2020.For the Adhesive Technologies business unit, which is likely to be significantly impacted by a sharp decline in general industrial demand and, in particular, in the automotive industry, Henkel anticipates organic sales growth in the range between -5.5 and -6.5 percent. For the Beauty Care business unit, Henkel currently anticipates organic sales growth in the range between -2.0 and -3.0 percent. A significant decline in the Hair Salon business due to the pandemic, particularly in the first half, will have an impact on this business unit in the full fiscal year. For Laundry & Home Care, Henkel expects organic sales growth in the range between +4.5 and +5.5 percent.At Group level, Henkel expects to achieve an adjusted return on sales (EBIT margin) in the range between 13.0 and 13.5 percent. For the Adhesive Technologies business unit, Henkel expects an EBIT margin in the range between 14.5 and 15.0 percent, for Beauty Care in the range between 10.0 and 10.5 percent and for Laundry & Home Care in the range between 15.0 and 15.5 percent.The decline in sales in the industrial and Hair Salon businesses due to the pandemic will have a negative impact on the adjusted EBIT margin. As announced at the beginning of the year, Henkel is also increasing investments in marketing and advertising, as well as in digitalization and IT.Adjusted earnings per preferred share (EPS) at constant exchange rates are expected to decline in the range between -18 and -22 percent.Preliminary sales development in the third quarterBased on preliminary figures, Henkel delivered organic sales growth, which excludes the impact of currency effects and acquisitions/divestments, of +3.9 percent.Based on preliminary figures, the Adhesive Technologies business unit achieved positive organic sales growth of +1.3 percent in the third quarter. Compared to the second quarter, a recovery in demand was recorded across all business areas.According to the preliminary figures, Beauty Care delivered very strong organic sales growth of +4.3 percent. While the development of the Hair Salon business was below the level of the prior-year quarter despite a recovery, the retail business achieved significant organic sales growth in the third quarter.Thanks to continued strong demand for Laundry & Home Care products as well as catch-up effects from the second quarter, preliminary figures for this business unit also indicate significant organic sales growth in the third quarter of +7.7 percent.Henkel will publish its statement for the third quarter 2020 on November 10, 2020.Henkel AG & Co. KGaAFurther information regarding financial instruments issued by Henkel Company: Henkel AG & Co. KGaA Contact: Heinz Nicolas Department: CLC / Telephone: +49 211 797 4516 Email: heinz.nicolas@henkel.com Address: 40191 Düsseldorf, Deutschland Henkel Preferred Share: ISIN DE0006048432 // WKN 604843 Henkel Ordinary Share: ISIN DE0006048408 // WKN 604840 Listing: Regulated market (Prime Standard), all eight German Stock Exchanges  For further financial instruments see www.henkel.com/irDisclaimerThis information contains forward-looking statements which are based on the current estimates and assumptions made by the corporate management of Henkel AG Co. KGaA. Forward-looking statements are characterized by the use of words such as expect, intend, plan, predict, assume, believe, estimate, anticipate, etc. Such statements are not to be understood as in any way guaranteeing that those expectations will turn out to be accurate. Future performance and the results actually achieved by Henkel AG Co. KGaA and its affiliated companies depend on a number of risks and uncertainties and may therefore differ materially from the forward-looking statements. Many of these factors are outside Henkel's control and cannot be accurately estimated in advance, such as the future economic environment and the actions of competitors and others involved in the marketplace. Henkel neither plans nor undertakes to update any forward-looking statements.This information includes - in the applicable financial reporting framework not clearly defined - supplement financials measures that are or may be alternative performance measures (non-GAAP-measures). These supplement financials measures should not be viewed in isolation or as alternatives to measures of Henkel's net assets and financial positions or results of operations as presented in accordance with applicable financial reporting framework in its Consolidated Financial Statements. Other companies that report or describe similarly titled alternative performance measures may calculate them differently. Explanations of financial measures used can be found in the Annual Report of Henkel (available at https://www.henkel.com/investors-and-analysts).This document has been issued for information purposes only and is not intended to constitute an investment advice or an offer to sell, or a solicitation of an offer to buy, any securities.09-Oct-2020 CET/CEST The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Archive at www.dgap.de Language: English Company: Henkel AG & Co. KGaA Henkel Str. 67 40191 Düsseldorf Germany Phone: +49 (0)211 797-0 Fax: +49 (0)211 798-4008 E-mail: press@henkel.com Internet: www.henkel.de ISIN: DE0006048432, DE0006048408 WKN: 604843, 604840 Indices: DAX Listed: Regulated Market in Berlin, Dusseldorf, Frankfurt (Prime Standard), Hamburg, Hanover, Munich, Stuttgart; Regulated Unofficial Market in Tradegate Exchange EQS News ID: 1139888   End of Announcement DGAP News Service

  • EQS Group

    Henkel AG & Co. KGaA: Henkel delivers overall robust business performance despite substantial impact from COVID-19 pandemic

    DGAP-News: Henkel AG & Co. KGaA / Key word(s): Half Year Results 06.08.2020 / 07:34 The issuer is solely responsible for the content of this announcement. August 6, 2020 Henkel reports on first half and second quarter 2020 Henkel delivers overall robust business performance despite substantial impact from COVID-19 pandemic * Focus on ensuring employee safety, supplying customers and supporting communities * Group half-year sales reach 9,485 million euros, nominal: -6.0%, organic: -5.2% * Operating profit* at 1,191 million euros, -27.5% * EBIT margin* at 12.6%, -370 basis points * Earnings per preferred share (EPS)*: -29.2% to 1.96 euros, -28.2% at constant exchange rates * Free cash flow at 938 million euros, net financial position improved * No new full-year outlook for 2020 due to continuing market uncertainties * Implementation of new agenda for purposeful growth on track Düsseldorf - "In the first half of 2020, Henkel was substantially impacted by the significant global economic downturn and the sharp decline in demand across many industries. During this unprecedented global crisis, our focus is to protect employees, supply customers, ensure business continuity and support communities. Thanks to the outstanding team spirit and commitment of our people around the world, we were able to achieve this in the first half of 2020. The breadth of our portfolio in the consumer and industrial businesses helped us to balance the impact of the crisis on our overall sales and earnings performance: In the first six months of 2020, we achieved sales of around 9.5 billion euros, an operating profit of 1.2 billion euros and 12.6 percent EBIT margin. We paid out the full dividend for 2019 to shareholders, and we were able to generate a very strong free cash flow and further improve our net financial position. During the crisis we did not introduce short-time working, apply for government aid or reduce our workforce due to the pandemic. In summary, we delivered an overall robust performance in an exceptionally challenging environment," said Henkel CEO Carsten Knobel. Henkel recorded sales of 9,485 million euros in the first half of 2020. This is a decline of -6.0 percent in nominal terms and -5.2 percent in organic terms compared to the first half of the prior year. Henkel also achieved an adjusted operating profit of 1,191 million euros in the first six months of 2020, -27.5 percent below the prior year. The adjusted EBIT margin was at 12.6 percent, -370 basis points lower than in the prior-year period. In the course of the first six months, Adhesive Technologies was impacted primarily by significantly declining demand from key customer industries. Beauty Care performance was affected mostly by the significantly negative Hair Salon business, driven by the salon closures enforced in numerous countries. Laundry & Home Care showed a very strong development, also supported by a surge in demand for cleaning products. "Given the continued uncertainties, however we cannot provide a new and reliable outlook for the full-year at this point in time," said Carsten Knobel. "As we are managing the current crisis, we remain fully dedicated to our ambitious growth agenda for the coming years. We started first initiatives in line with our new strategic framework and will continue to actively drive the implementation of our agenda for purposeful growth." Group sales and earnings performance in the first half of 2020 At 9,485 million euros, Henkel Group sales in the first half of 2020 were -6.0 percent below the prior-year period (Q2: 4,558 million euros; -11.0 percent). Organic sales, which exclude the impact of currency effects and acquisitions/divestments, showed a negative development of -5.2 percent (Q2: -9.4 percent). The contribution from acquisitions and divestments amounted to 0.3 percent (Q2: 0.2 percent). Currency effects had a negative impact of -1.1 percent on sales (Q2: -1.9 percent). Emerging markets showed an organic sales development of -2.6 percent (Q2: -7.1 percent). Mature markets showed a negative organic sales development of -6.9 percent (Q2: -10.9 percent). Half-year sales in Western Europe showed a negative organic development of -8.0 percent (Q2: -11.6 percent). Eastern Europe achieved organic growth of 3.1 percent (Q2: -3.8 percent). In Africa/Middle East, sales grew organically by 4.2 percent (Q2: 1.4 percent). North America recorded organic sales development of -6.4 percent (Q2: -10.9 percent). Latin America registered an organic sales development of -11.4 percent (Q2: -20.1 percent). In the Asia-Pacific region, sales decreased organically by -6.4 percent (Q2: -7.2 percent). Adjusted operating profit (adjusted EBIT) decreased by -27.5 percent from 1,641 million euros in the first half of the previous year to 1,191 million euros in 2020. Adjusted return on sales (adjusted EBIT margin) in the first six months reached 12.6 percent, -3.7 percentage points below the prior year. Adjusted earnings per preferred share decreased by -29.2 percent from 2.77 euros in the first half of 2019 to 1.96 euros. At constant exchange rates, adjusted earnings per preferred share decreased by -28.2 percent. Net working capital further improved to 4.4 percent of sales, significantly below the prior-year period (6.7 percent). Free cash flow remained very strong, reaching 938 million euros in the first half of 2020 (First half 2019: 990 million euros). Effective June 30, 2020, Henkel's net financial position improved to -1,951 million euros (December 31, 2019: -2,047 million euros) - despite the payout of a dividend of around 800 million euros in the second quarter. Business unit performance in first half of 2020 In the first half of 2020, sales in the Adhesive Technologies business unit were nominally -12.2 percent below prior-year level, reaching 4,153 million euros (Q2: 1,944 million euros, -19.7 percent). Organically, sales development was -10.9 percent (Q2: -17.4 percent). The development in the first half year and particularly in the second quarter was impacted by a significant decline in industrial and automotive production as a result of the COVID-19 pandemic. Adjusted operating profit decreased by 36.6 percent and reached 543 million euros. At 13.1 percent, adjusted return on sales was below the level of the first half of 2019. The margin decline was due in particular to the significantly lower sales volume as a result of the pandemic. In the Beauty Care business unit, sales in the first half of 2020 showed an organic development of -8.5 percent (Q2: -12.8 percent). Nominally, sales were -7.4 percent below prior-year level, reaching 1,818 million euros (Q2: 883 million euros, -11.9 percent). The development is particularly due to the negative impacts of the COVID-19 pandemic on the Hair Salon business. Adjusted operating profit reached 172 million euros and was -35.4 percent below the level of the first half of 2019. Adjusted return on sales showed a negative development and reached 9.4 percent, particularly impacted by the declining sales volume in the Hair Salon business. The Laundry & Home Care business unit generated organic sales growth of 4.9 percent in the first half of 2020 (Q2: 4.4 percent). Nominally, sales increased by 3.8 percent to 3,460 million euros (Q2: 1,705 million euros, 2.3 percent). At 531 million euros, adjusted operating profit was -6.0 percent below the prior-year period. At 15.3 percent, adjusted return on sales was below the level of the first half of 2019, especially due to the higher investments in marketing and advertising as well as digital and Purposeful growth agenda: Implementation of new strategic framework At the beginning of March 2020, Henkel presented the company's growth agenda for the coming years. Henkel has developed a clear strategic framework. It includes: a winning portfolio, competitive edge, particularly in the areas of innovation, sustainability, digitalization, a future-ready operating model as well as a strong corporate culture. "This strategic framework will help us to win the 20s for Henkel with a clear focus on purposeful growth," Carsten Knobel explained. "Since the announcement in March we already made good progress in initiating first actions and implementing measures." A key element of Henkel's future direction is an active portfolio management. Henkel has identified brands and categories with a total sales volume of more than one billion euros, predominantly in its consumer businesses, of which around 50 percent are marked to be divested or discontinued by the end of 2021. Despite the current market uncertainties, Henkel reconfirmed the portfolio measures to be executed in the announced timeframe. In the course of this year, Henkel already discontinued businesses and signed divestments with a total sales volume of around 80 million euros, mainly in the Adhesive Technologies business unit. Along with active portfolio management, acquisitions remain an integral part of Henkel's strategy. Recently, Henkel signed two transactions with a combined purchase price of around 500 million euros. In the Beauty Care business unit, Henkel expands its digital direct-to-consumer (D2C) activities through the acquisition of a majority stake in a business comprising three fast-growing premium beauty brands. In the Adhesive Technologies business, Henkel will expand its position in adhesives and sealants for consumers and craftsmen in North America with the acquisition of an attractive consumer sealants portfolio marketed under the GE brand**. The acquired business comprises a range of silicone sealants for various applications. In order to further strengthen its competitive edge, Henkel will focus on accelerating impactful innovations, boosting sustainability as a differentiating factor and transforming digital into a customer and consumer value creator. Henkel aims to accelerate impactful innovations, supported by increased investments. This includes an enhanced innovation approach. Innovations and brands will be supported with consistent investments in core categories and regions. Therefore, Henkel is committed to further step up growth investments in advertising, digital and IT. In the first six months of this year, and despite the macroeconomic challenges, Henkel stepped up these investments by a high double-digit million-euro amount. In Adhesive Technologies, Henkel continued its investments into its state-of-the-art innovation center in Düsseldorf. In its consumer businesses, Henkel quickly ramped up an additional hygiene portfolio and production capacities for new hand sanitizers and cleaning products across different regions. A key pillar of Henkel's competitive edge strategy is clear differentiation in the market through impactful innovations. In Adhesive Technologies, Henkel used its broad industry portfolio for sealing and impregnation technology solutions to launch a new product line to increase the water resistance of high-end smartphones. This was a collaboration with one of the major smartphone brands in the world. Beauty Care launched the new Schwarzkopf brand Simply Color, based on the natural trends in the more "technological" category of hair coloration. The Laundry & Home Care business unit further rolled out Persil 4in1 Discs. Persil Discs are by now making up almost 10 percent of the overall sales under the Persil brand. Sustainability is one of Henkel's great strengths. The company has a leading role that is regularly confirmed in ratings and rankings. Therefore, Henkel aims to further strengthen its leading position in sustainability as a clear competitive edge. In order to further accelerate its efforts, Henkel has defined the next milestones and specific targets. One element is to become a climate-positive company by 2040. As the first company globally, Henkel placed a plastic waste reduction bond in June 2020. By that, Henkel took another step in combining attractive corporate finance instruments with progress in sustainability. The proceeds from this bond with a total volume of around 100 million euros will be specifically allocated to projects and expenditures related to Henkel's activities to reduce plastic waste. The bond underlines Henkel's commitment to foster a circular economy and reduce plastic waste as well as to Sustainable Finance. Henkel also expanded its Design for Recycling tool "EasyD4R", which allows to quickly and reliably assess the recyclability of packaging at an early stage in the development process. The software, which has been made available for other companies and organizations, now covers not only different types of plastic packaging but also materials such as paper, glass or aluminum. Henkel's progress in the area of sustainability is also reflected in products for consumers and industrial customers. For example, in the Laundry & Home Care business, the Pro Nature range has been expanded by launching Somat and Bref Pro Nature. Pro Nature products meanwhile are available in 30 countries and include up to 99.9% natural ingredients and use packaging with up to 100% recycled plastic. Beauty Care launched solid shampoo, body and face bars under the brands Nature Box and N.A.E. - without plastic packaging. With Loctite Liofol, Adhesive Technologies introduced a certified recyclable heat and cold seal coating into the market, which enables the replacement of polyethylene with paper, suitable for a wide range of food and non-food packaging. Next to innovation and sustainability, Henkel has defined digitalization as a key lever to strengthen its competitiveness. In the first half year, Henkel recorded a strong increase in digital sales of more than 60 percent in Beauty Care and Laundry & Home Care combined. For the Group, the digital share in overall sales is approaching the mid-teens percentage range. With its new unit "Digital Business", Henkel wants to become the digital business leader in its industries and generate tangible value for its customers. Therefore, at the end of June, Henkel introduced a new operating model for its digital and IT activities and brought together IT teams, digital business experts, business process owners and HenkelX Ventures, led by Henkel's Chief Digital & Information Officer (CDIO). Lean, fast and future-ready business processes are another important element of Henkel's strategic framework. The company regularly reviews its business processes and structures, assessing if they are lean, fast and simple, and adapts them to changing market developments and trends. In addition, new business models will be developed with the focus on ensuring proximity to customers and consumers. Henkel successfully implemented new operating models in Adhesive Technologies and its purchasing organization. In Laundry & Home Care and Beauty Care, the organizational changes to enhance regional focus and drive customer and consumer proximity are well on track. Further developing Henkel's corporate culture and accelerating the cultural transformation are other key elements of the company's way forward. The aspiration is to foster a collaborative culture with empowered people and with the company's leadership commitments at the core. For Henkel, it is key that employees continuously develop their professional and personal skills. In the first half of 2020, the company has therefore rolled out specifically designed training and upskilling projects, for example in the fields of leadership, digitalization and innovation. The current corona crisis has also proven the strong corporate culture of Henkel and the resilience and dedication of its employees worldwide. Measures addressing COVID-19 pandemic The COVID-19 pandemic has affected all areas of life and has severely impacted the global economy. In this crisis, the health and safety of the employees, customers and business partners are of the highest priority for Henkel. The company has introduced a broad range of protective measures at an early stage. At the same time, Henkel has made great efforts to continue its business activities and to serve customers and consumers around the world. In addition, Henkel launched a global solidarity program including financial donations, for example to the COVID-19 Solidarity Response Fund of the World Health Organization (WHO) and the United Nations (UN) Foundation and other selected organizations around the world. Furthermore, Henkel has donated more than 5 million products for personal and household hygiene and has produced disinfectants at its sites. Globally, Henkel has produced and donated more than 111,000 liters of disinfectant to support health authorities and hospitals. So far, Henkel supported almost 500 COVID-19-related projects in more than 40 countries worldwide helping almost 5 million people who have been in need through COVID-19. "We will need to constantly adapt as the crisis evolves. We will react flexibly and quickly to the disruptions in our markets. Actively shaping change and breaking new ground," Carsten Knobel summarized."I am convinced that with our dedicated global team, our new strategic framework focusing on purposeful growth, our strong balance sheet and financial flexibility as well as our ability to generate strong cash flow, we are well positioned to deal with this difficult situation and that we will emerge stronger from the crisis." * Adjusted for one-time expenses and income, and restructuring expenses. ** GE is a trademark of General Electric Company, used under license. About Henkel Henkel operates globally with a well-balanced and diversified portfolio. The company holds leading positions with its three business units in both industrial and consumer businesses thanks to strong brands, innovations and technologies. Henkel Adhesive Technologies is the global leader in the adhesives market - across all industry segments worldwide. In its Laundry & Home Care and Beauty Care businesses, Henkel holds leading positions in many markets and categories around the world. Founded in 1876, Henkel looks back on more than 140 years of success. In 2019, Henkel reported sales of more than 20 billion euros and adjusted operating profit of more than 3.2 billion euros. Henkel employs more than 52,000 people globally - a passionate and highly diverse team, united by a strong company culture, a common purpose to create sustainable value, and shared values. As a recognized leader in sustainability, Henkel holds top positions in many international indices and rankings. Henkel's preferred shares are listed in the German stock index DAX. For more information, please visit www.henkel.com. This information contains forward-looking statements which are based on current estimates and assumptions made by the corporate management of Henkel AG & Co. KGaA. Statements with respect to the future are characterized by the use of words such as "expect", "intend", "plan", "anticipate", "believe", "estimate", and similar terms. Such statements are not to be understood as in any way guaranteeing that those expectations will turn out to be accurate. Future performance and results actually achieved by Henkel AG & Co. KGaA and its affiliated companies depend on a number of risks and uncertainties and may therefore differ materially from the forward-looking statements. Many of these factors are outside Henkel's control and cannot be accurately estimated in advance, such as the future economic environment and the actions of competitors and others involved in the marketplace. Henkel neither plans nor undertakes to update any forward-looking statements. This document includes - in the applicable financial reporting framework not clearly defined - supplemental financial measures that are or may be alternative performance measures (non-GAAP-measures). These supplemental financial measures should not be viewed in isolation or as alternatives to measures of Henkel's net assets and financial positions or results of operations as presented in accordance with the applicable financial reporting framework in its Consolidated Financial Statements. Other companies that report or describe similarly titled alternative performance measures may calculate them differently. This document has been issued for information purposes only and is not intended to constitute an investment advice or an offer to sell, or a solicitation of an offer to buy, any securities. Contacts Investors & Analysts Lars Korinth Phone: +49 211 797 - 1631 Email: lars.korinth@henkel.com Mona Niermann Phone: +49 211 797 - 7151 Email: mona.niermann@henkel.com Dorothee Brinkmann Phone: +49 211 797 - 5299 Email: dorothee.brinkmann@henkel.com Press & Media Lars Witteck Phone: +49 211 797 - 2606 Email: lars.witteck@henkel.com Wulf Klüppelholz Phone: +49 211 797 - 1875 Email: wulf.klueppelholz@henkel.com Jennifer Ott Phone: +49 211 797 - 2756 Email: jennifer.ott@henkel.com www.henkel.com/press www.henkel.com/ir * * *06.08.2020 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG. The issuer is solely responsible for the content of this announcement. The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Archive at www.dgap.de * * * Language: English Company: Henkel AG & Co. KGaA Henkel Str. 67 40191 Düsseldorf Germany Phone: +49 (0)211 797-0 Fax: +49 (0)211 798-4008 E-mail: press@henkel.com Internet: www.henkel.de ISIN: DE0006048432, DE0006048408 WKN: 604843, 604840 Indices: DAX Listed: Regulated Market in Berlin, Dusseldorf, Frankfurt (Prime Standard), Hamburg, Hanover, Munich, Stuttgart; Regulated Unofficial Market in Tradegate Exchange EQS News ID: 1111385 End of News DGAP News Service