Berlin — In a preliminary report, The Wella Group said sales for the January through September period rose about 10.3 percent, when adjusted for currency effects, to $2.4 billion. All dollar figures are converted from the euro at current exchange rates.
This story first appeared in the October 21, 2002 issue of WWD. Subscribe Today.
Despite the burdening effect of currency translations, sales in the third quarter grew dynamically compared with the year and the sector as a whole, Wella noted, with a rise of 14.3 percent after currency adjustments (nominal 7.9 percent).
The Darmstadt-based group has not adjusted its sales forecast for the year as a whole. Wella continues to expect sales growth of between 10 and 14 percent, based on unchanged foreign exchange rates. The company is also confident that it can achieve its medium-term target of increasing the EBIT (earnings before interest and taxes) margin to 13 percent by 2005. Wella further projects that the EBIT for 2002 will rise disproportionately to sales in expectation of a strong fourth quarter.
By division, the largest professional division saw sales rise by 8.2 percent in the first nine months, which, adjusted for currency effects and effects from acquisitions, came to about 5.4 percent. The consumer division grew sales by about 5.1 percent after adjustments for currency effects.
The strongest performer, however, was the cosmetics and fragrances division under Cosmopolitan Cosmetics GmbH. Here, sales increased 14.9 percent, which, adjusted for currency effects, came to about 16.2 percent.
Reports early last week of a Henkel bid for the Darmstadt beauty firm, which Wella energetically denied, boosted the Wella share price by up to 40 percent last week. Last Thursday, the stock continued to trade as high as $52.83, up from the pre-rumor closing of $38.54 the previous Friday. After denying reports of a Henkel takeover offer on Monday, the German hair care giant also refuted an article in Le Figaro last Wednesday that it intends to restructure Cosmopolitan Cosmetics, its fragrance and cosmetics arm, by reportedly closing its French office and perhaps transferring the Escada Beauté and Montblanc brands to its U. S. offices. “It’s absolutely crazy; totally unfounded,” declared Werner Hofmann, senior vice president of Cosmopolitan Cosmetics.