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Beauty Beat: Strong Sales Lift Henkel In 4th Quarter and Year

Henkel's cosmetics and toiletries division had a strong fourth quarter in 2006; earnings before interest and taxes rose 12 percent, to 101 million euros, or $130.2 million at average exchange.

BERLIN — Henkel’s cosmetics and toiletries division had a strong fourth quarter in 2006; earnings before interest and taxes rose 12 percent, to 101 million euros, or $130.2 million at average exchange. Adjusted for foreign exchange, EBIT was up 14.3 percent for the period.

Fourth-quarter sales for the division rose 9.5 percent, or 12 percent on a foreign currency adjusted basis, to 734 million euros, or $946.6 million. Organic growth was placed at 5.2 percent for the quarter.

For fiscal 2006, Henkel’s beauty business reported an 11.7 percent rise in EBIT to 359 million euros, or $451 million, while sales gained 8.9 percent, to 2.86 billion euros, or $3.6 billion. The division’s organic growth was 4.1 percent.

The Henkel Group, which includes laundry and home care, consumer and craftsman adhesives, and Henkel technologies, reported a 13.1 percent gain in net earnings for the year to 871 million euros, or $1.09 billion. Operating profits improved by 11.7 percent, and return on sales rose 0.5 percentage points, to 10.2 percent. Group sales were up 6.4 percent, to 12.74 billion euros, or $16 billion, and organic sales growth, adjusted for foreign exchange and acquisitions/divestments, was 6 percent.

The Düsseldorf-based group is forecasting organic sales growth, when adjusted for foreign exchange, of 3 percent to 4 percent, and for EBIT to exceed the pace of organic sales.

This story first appeared in the February 6, 2007 issue of WWD.  Subscribe Today.