Beiersdorf: Sales increase in focus categories

The Beiersdorf Group recorded organic sales growth of 2.1% in the first nine months of 2011. At current exchange rates, Group sales were up 1.1% on the previous year, at €4,275 million (previous year: €4,228 million). The operating result (EBIT) excluding special factors amounted to €492 million (previous year: €552 million). As a result, the EBIT margin was 11.5% (previous year: 13.1%). Consolidated profit after tax decreased to €336 million (previous year: €353 million).

“Beiersdorf recorded above-average nine-month growth rates in its key Consumer business focus categories, face and body care by concentrating on its core competency – skin care. This offset the decline in sales resulting from product streamlining measures,” the company stated.

Thomas-B. Quaas commented on the first nine months of the year as follows: “We are continuing to hit our planning targets in full in Beiersdorf’s realignment year. The implementation of our ‘Focus on Skin Care. Closer to Markets’ strategy, which bundles our activities to focus on our core competency, skin care, is bearing fruit. This enabled us to achieve above-average growth in our focus categories ─ face and body care. Our global campaign marking the 100th anniversary of the NIVEA brand contributed to this strong performance.”

Organic sales in the Consumer business segment increased by 0.9% in the first nine months of 2011. Nominal sales amounted to €3,570 million (previous year: €3,574 million). The operating result excluding special factors was influenced by the increased marketing spend in connection with the activities for the 100th anniversary of NIVEA and totaled €409 million (previous year: €467 million). The corresponding EBIT margin was 11.5% (previous year: 13.1%).

Performance in Europe was affected the most by the streamlining of the product range and the exit from the NIVEA Make-up business. Sales amounted to €2,180 million (previous year: €2,216 million). Sales in Germany were 4.3% below the previous year, while sales in the other Western European markets declined by 2.0%. Some countries were unable to match their prior-year sales due to the impact of the streamlining measures, among other things. The United Kingdom and Austria recorded strong growth. The Eastern Europe region saw a sales increase of 3.7%, with the Russia/Ukraine Group and the CEE Group performing particularly well.

Sales in the Americas region rose 12.1% to €625 million (previous year: €582 million). North America recorded a 5.1% growth rate, while sales in Latin America were up 16.5%. In addition to Argentina and Brazil, the Andean Group made an especially strong contribution to this encouraging growth. All other key markets also saw healthy increases.

Sales in the Africa/Asia/Australia region were flat (–0.4%) compared with the previous year, at €765 million (previous year: €776 million). Japan, South Africa, and India in particular experienced healthy sales increases. Sales growth in China was negative due to the ongoing reorganization of the business structures there.

Beiersdorf confirms outlook for 2011

“Slight sales growth is expected at Group level. The consolidated operating EBIT margin before special factors is expected to be between 10 and 11% in 2011, while the corresponding return on sales after tax is forecast at between 7 and 8%,” Beiersdorf said.

And added: “Sales growth in the Consumer business segment will continue to be significantly affected by the streamlining of the product range. However, growth in the core areas is expected to more or less offset these effects. As a result, the business segment is aiming to generate sales that are on a par with 2010 levels. The target EBIT margin is around 10-11%.”

About Beiersdorf AG

Cosmetics company Beiersdorf AG is based in Hamburg, Germany, and has around 18,000 employees worldwide. Its sales in 2010 amounted to €5.571 billion (using the new sales presentation format). The company has been listed on the DAX since December 2008. Beiersdorf’s NIVEA is the world’s largest skin care brand. Other names in its successful international brand portfolio include Eucerin, La Prairie, Labello, 8x4, and Hansaplast/Elastoplast.