JEDDAH – Henkel consumer product company headquartered in Düsseldorf, continues to expect organic sales growth of 3 to 5 percent in the fiscal year 2015. Henkel expects that the Adhesive Technologies and Laundry & Home Care business units will each generate organic sales growth within this range. In the Beauty Care business unit, Henkel expects growth of approximately 2 percent. As before, Henkel expects a stable development in the share of sales from emerging markets. Compared to the 2014 figures, Henkel expects adjusted return on sales (EBIT) to increase to around 16 percent and an increase in adjusted earnings per preferred share of approximately 10 percent. In the first quarter of 2015, sales rose significantly by 12.7 percent, reaching a new quarterly high of 4,430 million euros. Adjusted for positive foreign exchange effects of 5.8 percent, sales improved by 6.9 percent. Organically – i.e. adjusted for foreign exchange and acquisitions/divestments – sales rose by 3.6 percent.
The Laundry & Home Care business unit recorded strong organic sales growth of 5.2 percent. In the Beauty Care business unit a solid increase in organic sales of 2.1 percent was achieved. The Adhesive Technologies business unit posted a solid improvement in organic sales of 3.3 percent. “In a challenging environment, Henkel delivered a strong performance in the first quarter and had a good start to the fiscal year 2015. We again increased both sales and earnings. We achieved our highest quarterly sales to date, thanks to good organic sales growth, the impact of last year's acquisitions and the strong US dollar. All business units contributed to this successful quarter. Once again, we delivered a very strong performance in our emerging markets,” said Henkel CEO Kasper Rorsted.
Commenting on the fiscal year 2015, Rorsted stated: “We expect the economic environment to remain difficult. Due to the continuing conflict between Russia and Ukraine, we still assume that the Eastern European economy will stagnate in 2015. In this context, a high degree of agility and flexibility will remain key success factors. We will therefore continue to simplify and accelerate our structures and processes.”After one-time gains, one-time charges and restructuring charges, adjusted operating profit improved by 14.1 percent, from 619 million euros to 707 million euros. Reported operating profit (EBIT) grew by 6.5 percent, from 608 million euros to 648 million euros.
Adjusted return on sales (EBIT margin) increased by 0.2 percentage points to 16.0 percent. Reported return on sales amounted to 14.6 percent compared to 15.5 percent in the prior-year quarter.
Henkel's financial result improved by 6 million euros to -9 million euros. This was attributable to improvements in both net interest result and foreign exchange result. The improvement in net interest result was due in part to the repayment of a senior bond and the maturing of interest rate fixings in March 2014. The tax rate amounted to 24.6 percent compared to 23.1 percent in the prior-year quarter.
Adjusted net income for the quarter, after deducting non-controlling interests, increased by 12.8 percent from 452 million euros to 510 million euros. Reported net income for the quarter rose by 5.7 percent from 456 million euros to 482 million euros. After deducting 12 million euros attributable to non-controlling interests, net income increased to 470 million euros (prior-year quarter: 449 million euros).
Adjusted earnings per preferred share (EPS) rose by 13.5 percent from 1.04 euros to 1.18 euros. Reported EPS increased from 1.04 euros to 1.09 euros. Net working capital relative to sales increased year-on-year by 1.4 percentage points to 6.2 percent. — SG
