Persil maker Henkel beats organic sales forecasts driven by resilient volumes
By Bartosz Dabrowski
Henkel’s First-Quarter Performance and Market Response
May 7 (Reuters) - German consumer goods and adhesives maker Henkel reported an organic 1.7% rise in first-quarter sales on Thursday, beating market expectations, driven by volume growth in both branches of its business.
Sales Figures and Analyst Expectations
The group's sales in the January-March quarter were 4.95 billion euros ($5.82 billion), as the organic growth exceeded analysts' average forecast of 1.1% in a Vara Research poll.
Stock Market Reaction
Shares of Henkel, whose numerous consumer brands include Persil, Bref, Schwarzkopf and Syoss, were up 4.3% as of 0835 GMT.
Management and Analyst Commentary
CEO’s Statement on Performance
"If you look at quarter one, I think we have a good balance between price and volume ... with 0.7% (rise in) price and 1.0% volume, even a higher volume start into the year," CEO Carsten Knobel said in a conference call.
Analyst Insights
Jefferies said in a note to investors that first-quarter volumes held up better than feared, particularly for Henkel's consumer brands.
Sector Context and Business Unit Breakdown
Consumer Goods Sector Trends
Europe's consumer goods sector is showing uneven momentum, with resilient demand for home care and hygiene products contrasting with weaker discretionary and personal care spending, as subdued consumer confidence and limited real income growth persist.
Performance by Business Unit
Adhesive Technologies
Henkel said its adhesive technologies unit, which sells bonding, sealing and coating solutions for a range of industries, posted organic sales growth of 1.7% in the quarter, driven by mobility & electronics, while the consumer brands unit saw 1.8% growth lifted by its hair business area.
Consumer Brands
The company confirmed its guidance for the full year, still expecting organic sales to grow between 1% and 3%.
Additional Information
($1 = 0.8510 euros)
(Reporting by Bartosz Dabrowski in Gdansk, editing by Milla Nissi-Prussak)
