BERLIN — Beiersdorf AG’s net income rose 8.3 percent in 2016 to 727 million euros, or $804.7 million, bolstered by effective cost efficiencies.
Both the Hamburg, Germany-based consumer goods company’s consumer and adhesives divisions also contributed to the increase and are expected to outperform the market in 2017.
The maker of Nivea, La Prairie and Tesa reported that 2016 operating profits (EBIT) rose 5.5 percent to 1.02 billion euros, or $1.13 billion, a record for the firm. EBIT margin increased to 15 percent, also a new high for Beiersdorf.
In its annual report released on Wednesday, the company confirmed its full-year group sales grew 1 percent to 6.75 billion euros, or $7.47 billion. On an organic basis, sales rose 3.2 percent.
Operating profits for Beiersdorf’s consumer products division also reached record levels, climbing 7.6 percent to 829 million euros, or $917.6 million. Revenues for the division increased by 1.1 percent to 5.6 billion euros, or $6.2 billion. In organic terms, they advanced 3.3 percent.
Organic growth was registered in all geographies, with the greatest upturn coming from the Africa, Asia, Australia region, where sales rose 5.7 percent, despite a weak performance in China. Sales in the Americas increased 2.9 percent, boosted by Mexico and Brazil, while in Europe revenues improved 2 percent, driven by gains of 6.6 percent in Eastern Europe, primarily Russia.
Sales of Nivea increased 3.8 percent; Eucerin, 1.5 percent, and La Prairie, 5.5 percent.
Operating profits for the Beiersdorf adhesives arm Tesa dipped 2.6 percent to 186 million euros, or $205.9 million. Sales for the unit rose 0.6 percent to 1.15 billion euros, or $1.27 billion. On an organic basis, Tesa’s revenue increase was 2.6 percent.
Dollar figures are converted at average exchange for the period to which they refer.
“Last year we were among the few companies that increased their earnings guidance in the course of the year,” Beiersdorf chief executive officer Stefan Heidenreich said in a statement. “Although the environment will remain tough, we look to fiscal year 2017 with cautious optimism.”
The company said it anticipates group sales will outperform the market and grow between 3 percent and 4 percent, and that its EBIT margin will likely increase slightly in 2017.