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Henkel Cosmetics and Toiletries Net Up

BERLIN — The cosmetics and toiletries division of the Henkel Group had a strong fourth quarter ended Dec. 31, with operating profit rising 31.5 percent to 70 million euros, or $90.8 million at average exchange rates, and sales growing 22.9...

BERLIN — The cosmetics and toiletries division of the Henkel Group had a strong fourth quarter ended Dec. 31, with operating profit rising 31.5 percent to 70 million euros, or $90.8 million at average exchange rates, and sales growing 22.9 percent to 664 million euros, or $861.1 million.

On Thursday, the Düsseldorf-based group said acquisitions such as Dial, ARL and Indola helped boost 2004 beauty sales by 18.7 percent to 2.48 billion euros, or $3.24 billion. Adjusted for currency effects, sales for the division grew 21.8 percent. Earnings before interest and taxes for the year rose 16.2 percent to 225 million euros, or $293.9 million.

The group, which also includes laundry and home care, consumer and craftsman adhesives and technologies divisions, reached its growth objectives in 2004. Group sales rose 12.3 percent to 10.59 billion euros, or $13.83 billion, with organic growth placed at 2.9 percent. Last summer, Henkel lowered its organic growth target from 3 to 4 percent to 2 percent.

Group pretax earnings surged from 706 million euros, or $922.3 million, to 1.92 billion euros, or $2.51 billion. This figure includes one-time proceeds of 1.77 billion euros, or $2.31 billion, relating to an exchange of Henkel’s 28.8 percent stake in Clorox, the group pointed out.

In 2005, Henkel said it expects sales, after adjustments for foreign exchange rates and acquisitions divestments, to organically grow between 3 and 4 percent. Without exceptional items, the group is forecasting growth in pretax earnings, after adjusting for foreign exchange, to be in the high teens.

This story first appeared in the February 4, 2005 issue of WWD.  Subscribe Today.