BERLIN – First-quarter net profits at German cosmetics and household products company Henkel, maker of Persil detergent and Taft hairspray, fell 45.7 percent to 121 million euros, or $158.5 million.
Sales rose 3.1 percent to 3.26 billion euros, or $4.27 billion, while operating profits sank 31.7 percent to 218 million euros, or $285.6 million. Dollar figures are converted at average exchange rates for the period.
The Düsseldorf-based firm’s cosmetics and toiletries group, which made up 21 percent of total company sales in 2008, posted an increase in operating profits of 4.1 percent, or 4.8 percent after adjusting for foreign exchange, to 91 million euros, or $119.2 million. Sales rose 1.7 percent to 720 million euros, or $943.2 million.
Henkel’s sluggish group results are largely due to drops in its adhesives technology division, which has been marked by the effect of the financial slowdown on its industrial customers. Operating profits in this sector of the company fell by 68.6 percent to 47 million euros, or $61.6 million, during the first quarter.
“We are dissatisfied with our start to fiscal 2009. However, we are convinced that, as a result of our early introduction of countermeasures and based on our solid financial position, we will emerge from this still difficult economic environment stronger than before,” stated Kasper Rorsted, chairman of the Henkel management board.