Henkel, the German chemicals and consumer goods group has said that it expects first-quarter sales to significantly exceed market expectations with organic growth of around 7%.
Its adhesive technologies unit is to achieve organic sales growth of around 12.5%, driven by a recovery in industrial demand. Beauty products are forecast to grow by 1% and laundry and home care by 3.5%.
Henkel issued the guidance update in a regulatory news release, as required under stock exchange rules when performance diverges from market expectations. It will provide detail in its quarterly results statement on 6 May.
'Very Good Performance'
“Despite the ongoing COVID-19 pandemic we expect that Henkel will report a very good performance in the first quarter of the year, in particular, driven by the Adhesive Technologies business unit,” said Henkel CEO Carsten Knobel.
Last month, the group, best known for its Schwarzkopf hair care products and Persil detergents, forecast organic sales growth of 2% to 5% for 2021 and a rise in adjusted earnings per preferred share of 5% to 15%, at constant exchange rates.
Performance In 2020
In 2020, Henkel's sales fell 4.3% to €19.25 billion, while adjusted operating profit dropped 20% to €2.579 billion, both slightly ahead of average analyst consensus.
Before the coronavirus outbreak in Europe, Henkel had forecast organic sales to increase up to 2% in 2020.
Sales at its adhesives business, which accounts for around half of group sales and largely relies on demand from industrial customers like the auto makers, fell 4.2% in 2020, while the beauty care division reported a decline of 2.8%. [Pic: ©Ralf Liebhold/123RF.COM]
News by Reuters edited by Donna Ahern, Checkout. Click subscribe to sign up for the Checkout print edition.
