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Henkel Net Leaps 86.7 Percent in Second Quarter

Beauty business posts a 12.4 percent gain in operating profits.

BERLIN — The Henkel Group posted an 86.7 percent leap in second-quarter net income to 280 million euros, or $357.3 million at average exchange.

The group, which comprises cosmetics and toiletries, laundry and home care, and adhesive technologies divisions, said the surge in profits was due to increased earnings before interest and taxes, which rose 51.2 percent to 421 million euros, or $537.2 million. The EBIT gains, in turn, were buoyed largely by improvement in the firm’s adhesive technologies sector.

Group sales rose 11.6 percent to 3.89 billion euros, or $4.96 billion. On an organic basis — after adjusting for foreign exchange, acquisitions and divestments — group sales rose 6.8 percent.

Henkel’s beauty business saw earnings and revenues increase in the second quarter, posting a 12.4 percent gain in EBIT to 112 million euros, or $142.9 million, and organic sales growth of 5 percent to 865 million euros, or $1.1 billion.

Henkel said ongoing innovation within its leading cosmetics and toiletries brands— Schwarzkopf, Dial, Fa, Right Guard and Diadermine — brought in the beauty gains. Geographically, Asia (excluding Japan), Africa and the Middle East, Latin America and Eastern Europe generated double-digit revenue increases in the quarter. Sales in Western Europe also rose, as did domestic sales, but in North America, Henkel experienced a slight decline.

Based on its strong second-quarter performance, Henkel has set a higher group sales and profits forecast for the year. It now expects EBIT and adjusted earnings per preferred share to grow more than 25 percent, up from its earlier forecast of 15 percent. The group also anticipates the world economy to grow around 3.5 percent, rather than 3 percent, with its own sales outperforming associated markets.