Henkel: exchange rates push annual results down

Henkel has had a bad financial year: the German company’s turnover went down 0.6 % at 19.9 billion euros due to negative exchange rate effects), while net profits went down by 8.3 % to 2.33 billion euros.

Organic growth

In its fiscal year 2018, Henkel’s turnover decreased to 19.9 billion euros as exchange rate fluctuations impacted the turnover by about 1.1 billion euros. The organic turnover, which excludes the impact of currency effects, acquisitions and divestments, did increase by 2.4 %.

Glues generated an autonomous turnover growth of 4.0 %, but beauty and care products saw their organic turnover drop by 0.7 %. Organic turnover increased in all markets outside of North America: the strongest growth was in Africa and the Middle East (+ 11.3 %), while Eastern Europe achieved very well too (+ 7.6 %). Delivery problems in the United States caused a 1 % drop in the turnover.

Lower profits

The company’s EBIT was 1.0 % higher in 2018 than the year before and amounted to 3.49 billion euros. Net profits went down 8. 3%, ending at 2.33 billion euros.

Despite some disappointing results, CEO Hans Van Bylen remains satisfied: “2018 was a good year for Henkel. Despite significant currency headwinds and rising direct material prices, we achieved good organic sales growth, with strong earnings, profitability and cash flow. We made very good progress in implementing our strategic priorities and further improved our competitiveness. We are convinced that Henkel is well-positioned for the future.”