Henkel with significant sales growth in third quarter

Strategic priorities & financial targets 2012: improvement to 14
percent EBIT
margin

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Düsseldorf (euro adhoc) - . Strong sales growth of 12.0 percent

. Growth regions: sales plus 24.1 percent
. Organic sales growth: 3.5 percent
. Adjusted operating profit (EBIT): plus 6.3 percent
. Adjusted earnings per preferred share: plus 3.5 percent

"Despite continuing challenging market conditions we again
generated good organic sales growth in the third quarter," said
Henkel CEO Kasper Rorsted. "All our business sectors contributed
to this growth, each outperforming its relevant markets. Once
again, it was particularly our businesses in the growth regions
that supported this positive development. The integration of
the National Starch businesses, which were major contributors to
the substantial rise in total sales, continues on schedule."
Regarding Henkel's financial targets for 2012 Rorsted emphasized:
"We are committed to further accelerating profitable growth. By
focusing even stronger on our strategic priorities in the future, we
have set a clear course to achieving our medium-term targets."

In the third quarter of 2008, Henkel increased total sales by 12.0
percent to 3,760 million euros. This considerable rise is
attributable to good organic growth and the acquisition of the
National Starch businesses. After adjusting for foreign exchange,
sales even rose by 15.8 percent. In organic terms, or adjusted
for foreign exchange and acquisitions/divestments, sales increased
by 3.5 percent, with all business sectors contributing. The organic
improvement in sales in the growth regions was again in the
double-digit percentage range while performance in the mature
markets was sluggish.

Operating profit (EBIT) was primarily impacted once again in the
quarter under review by restructuring charges. These totaled 181
million euros compared to 9 million euros in the same quarter of
the previous year, and are particularly attributable to the
global efficiency enhancement program and the integration of the
National Starch businesses. As a result, EBIT declined to 191
million euros. Conversely operating profit, adjusted for
restructuring costs and one- time gains and charges ("adjusted
EBIT"), rose from 368 million euros to 391 million euros (+6.3
percent).

EBIT margin was 5.1 percent, while the adjusted EBIT margin decreased
from 11.0 percent to 10.4 percent. This is due primarily to the
heavy impact of raw material price increases on the Laundry & Home
Care and Adhesive Technologies business sectors. Investment
result, mainly attributable to Henkel's stake in Ecolab, rose by 2
million euros to 24 million euros while net interest expense
increased by 28 million euros from -44 million euros to -72 million
euros. This is largely the result of higher net debt arising from
payment of the purchase price for the National Starch businesses.
The financial result consequently decreased from -22 million euros
to -48 million euros. The tax rate amounted to 25.2 percent.

Due to lower EBIT and the increase in the negative financial
result, net earnings for the quarter decreased to 107 million
euros. After minority interests totaling 6 million euros, net
earnings for the quarter amounted to 101 million euros. At 251
million euros, adjusted quarterly net earnings after minority
interests were 2.4 percent above the prior-year level. Earnings
per preferred share decreased to 0.23 euros while the adjusted figure
increased by 3.5 percent to 0.59 euros.

Business Sector Performance

Organic sales generated by the Laundry & Home Care business sector
increased by a good 3.4 percent. At 1,068 million euros, sales
overall were 1.4 percent above the level for the previous year.
The foreign exchange impact amounted to a negative 2.1 percent.
Although operating profit fell from 126 million euros to 117
million euros, this was nevertheless the highest quarterly total
this year. Again in this quarter, the operating profit reflects the
increase in raw material prices that led to a substantial rise
in input costs. These were partially offset by price increases
and countermeasures introduced to reduce costs and increase
efficiency. Included for the first time in Laundry & Home Care's
operating profit is 3 million euros in expenses previously
attributable to the former Corporate Research function. In the
Laundry segment, the company achieved the highest increases in
organic sales in its growth regions. Here the biggest brand, Persil,
was the main growth driver, benefiting from innovations such as
Persil Gold Plus launched in a number of countries in Central
and Eastern Europe. Sales generated in North America by Purex,
Henkel's second largest global detergent brand, again registered an
increase. The improvement in the organic sales of the Home Care
business was also due primarily to performance in the growth
regions, especially Eastern Europe. By contrast the Western
European market remained difficult, despite the successful launch of
a number of new products such as the WC rim block product WC Frisch
3-Aktiv.

With organic sales growth of 3.4 percent versus a strong
prior-year quarter, the Cosmetics/Toiletries business sector was
able to maintain the positive trend of the last few quarters
within a substantially more difficult market environment. In
addition to another highly positive performance in North
America, the businesses in Eastern Europe, Asia and Latin America
also posted strong growth. At 770 million euros, nominal sales were
slightly higher than in the prior-year quarter, with growth after
adjusting for foreign exchange coming in at 3.3 percent. Operating
profit rose to 96 million euros. After adjusting for foreign
exchange it rose by 4.1 percent, despite further increases in input
costs. In addition, operating profit this quarter also includes for
the first time expenses of 2 million euros previously
attributable to the former Corporate Research function. Without
the latter item, operating profit increased by 6.3 percent. The
Hair Cosmetics segment continued to perform well with further
expansion in its market positions in all its categories -
Colorants, Care and Styling. Major contributing factors in this
regard were the international relaunch of the Gliss brand and the
introduction of the Taft line Power with Cashmere Touch. In the
Colorants category, the focus was on the relaunch of Brillance
and the introduction of the new ten-minute coloration product
Coloriste. The Body Care business continued to develop
positively, particularly in the US where the innovations under the
brands Dial and Dial for Men were among the most successful new
products launched in 2008. In Europe, Fa Deodorants in particular
continued their positive growth trend. The Skin Care business
further expanded its market position thanks to the good performance
of the Diadermine brand, with the focus this time on the launch
of the Age ExCellium Gold line. The emphasis in Oral Care was on
the relaunch of the international brand Theramed, supported by -
among others - the launch of the innovative Theramed 2in1
OxyWhite. The Hair Salon business continued to post very good
growth, supported in particular by product innovations under the
OSiS brand, Bonacure Time Restore, and the further expansion of the
IGORA brand.

Sales of the Adhesive Technologies business sector rose by 31.8
percent after adjusting for foreign exchange. This is primarily due
to the acquisition of the Adhesives and Electronic Materials
businesses of National Starch. Nominal sales growth was 26.2 percent
rising to 1,860 million euros, with organic growth coming in at
3.6 percent. Operating profit rose to 169 million euros. After
adjusting for foreign exchange the increase was 8.1 percent.
Earnings were impacted by 19 million euros in charges incurred
through the integration of the National Starch businesses, and by
expenses of 2 million euros reassigned from the former Corporate
Research function. Moreover, raw material prices continued to rise.
The capacity underutilization that arose from a decline in volumes
in Europe and North America could not be fully replenished. The
Craftsmen and Consumer segment was adversely affected by the
difficult conditions prevailing in North America and Western
Europe. However, there were further successful developments in
Eastern Europe and Latin America. The Building Adhesives
business continued to exhibit strong growth supported by, in
particular, its good performance in Eastern Europe and the Middle
East. The Industry segment benefited significantly from the
acquisition of the National Starch businesses while organic sales
remained roughly at the prior-year level. In the declining markets
of Western Europe and North America, the business was unable to
reach the sales figures of the prior-year quarter and has been
negatively impacted by the current difficulties in the
automotive industry. The products for industrial maintenance,
repair and overhaul under the Loctite brand again posted
positive results. Within the metals segment, the business
particularly expanded its market shares in Eastern Europe and Asia.
The performance of the National Starch businesses eased slightly
overall in the face of a market- related slowdown.

Regional Performance

Organic sales in the Europe/Africa/Middle East region increased by
3.7 percent, with all business sectors contributing. After adjusting
for foreign exchange, sales rose by 7.9 percent. At 2,319 million
euros, sales overall were 6.8 percent above the level of the
previous year. Double-digit organic growth rates were again achieved
in Eastern Europe and Africa/Middle East, while development in
Western Europe including Germany underwent a slight decline.
Overall, the share of total sales accounted for by the region
amounted to 62 percent. Organic sales of the North America region
increased by 0.3 percent. As a result of the difficult prevailing
market environment in this region, organic sales both of the
Adhesive Technologies business sector and Laundry & Home Care
underwent a slight decline. The Cosmetics/Toiletries business
sector, on the other hand, performed well. The weakness of the US
dollar produced a negative foreign exchange impact of 10.5
percent. After adjusting for foreign exchange, sales rose by 19.6
percent, with the acquired National Starch businesses making a major
contribution. With sales of 727 million euros, the share of total
sales accounted for by this region was 19 percent. Sales of the Latin
America region increased by a highly respectable 12.4 percent,
with all business sectors contributing. After adjusting for
foreign exchange, growth was 24.8 percent. And this was again
primarily due to the additional sales generated by the
National Starch businesses. At 215 million euros, the share of
total sales accounted for by this region was 6 percent. In the
Asia-Pacific region, organic sales exceeded the prior-year quarter
by 3.8 percent, and by 65.8 percent after adjusting for foreign
exchange. Here again, all business sectors made a
contribution. At 437 million euros, sales were 54.7 percent above
the prior- year quarter. The rise is primarily due to the
acquired National Starch businesses. The share of sales
accounted for by this region grew three percentage points to 11
percent. In the growth regions of Eastern Europe, Africa, Middle
East, Latin America and Asia (excluding Japan), sales increased by
24.1 percent to 1,448 million euros, corresponding to a share of
consolidated sales of 39 percent. After adjusting for foreign
exchange, sales rose by 27.6 percent while organic growth amounted
to a highly respectable 13.5 percent, with all business sectors
contributing.

Major Participation

Henkel has a 29.3 percent stake in Ecolab Inc., St. Paul,
Minnesota, USA. In the third quarter of 2008, Ecolab Inc.
generated sales of 1,626 million US dollars. This corresponds to
a rise of 15.1 percent. Net earnings for the quarter increased
by 10.7 percent to 126.2 million US dollars versus the
previous year. The market value of this participation as of September
30, 2008, amounted to around 2.5 billion euros.

Updated Sales and Profit Forecast 2008

Given the business developments of the first nine months of 2008
and taking into account the National Starch businesses acquired as
of April 3, Henkel has specified its sales and profit forecast for
full fiscal 2008 as follows:

Henkel expects to achieve organic sales growth (after adjusting
for foreign exchange and acquisitions/divestments) of 3 to 5
percent.

Henkel expects to increase operating profit adjusted for
restructuring charges and one-time gains and charges ("adjusted
EBIT") by around 10 percent (2007 base: 1,370 million euros).

Henkel expects to increase earnings per preferred share
adjusted for restructuring charges and one-time gains and charges
("adjusted EPS") in the low single-digit percentage range (2007
base: 2.19 euros).

Included in this forecast are initial savings arising from
the "Global Excellence" efficiency enhancement program and the
integration of the National Starch businesses. Not included in this
forecast are any influences arising from the sale in part or in
whole of our stake in Ecolab, the purchase price allocation for
the acquired National Starch businesses that still has to be carried
out, and the tax effects relating to a possible Ecolab transaction,
the acquisition and the restructuring charges.

Financial targets for 2012: Strategic priorities for profitable
growth defined

Henkel's financial targets for 2012 entail a further increase in
organic sales accompanied by disproportionate increases in both
operating profit and earnings per share. By focusing even stronger
on its strategic priorities Henkel will further accelerate its
profitable growth.

Margin improvement is to be achieved primarily by an even greater
focus on the company's core business. Henkel has defined a
number of measures in this regard, aligned to achieving a
substantially higher level of utilization of its existing business
potential. Within this context, portfolio and brand
management, innovations and efficiency improvements play a
major role. A significant contribution is also anticipated from
the integration of the National Starch businesses and the
implementation of the "Global Excellence" program announced in
February of this year.

Moreover, Henkel intends to further focus on its customers through
establishing direct contacts and developing joint strategies.
This will also involve expanding value-added services and
leveraging Henkel's capabilities to satisfy customer needs.

A further major factor in Henkel's future success lies in the
ongoing further development of its more than 55,000 employees around
the world. Here, Henkel will be focusing on increasing its
performance orientation and enhancing its approach to diversity
as a strategic competitive advantage.

The financial targets 2012 in detail have been defined as follows:

. Average organic sales growth: 3 - 5 percent
. Adjusted return on sales (EBIT margin): 14 percent by 2012
. Average growth in adjusted earnings per preferred share: > 10 percent

This information contains forward-looking statements which are
based on the current estimates and assumptions made by the
corporate management of Henkel AG & Co. KGaA. Forward-looking
statements are characterized by the use of words such as expect,
intend, plan, predict, assume, believe, estimate, anticipate, etc.
Such statements are not to be understood as in any way guaranteeing
that those expectations will turn out to be accurate. Future
performance and the results actually achieved by Henkel AG & Co.
KGaA and its affiliated companies depend on a number of risks
and uncertainties and may therefore differ materially from the
forward-looking statements. Many of these factors are outside
Henkel's control and cannot be accurately estimated in advance, such
as the future economic environment and the actions of
competitors and others involved in the marketplace. Henkel neither
plans nor undertakes to update any forward-looking statements.

Press Contacts:
Lars Witteck
Phone: +49-211-797-2606
Wulf Klüppelholz
Phone: +49-211-797-1875

Fax: +49-211-798-9208
press@henkel.com

Henkel AG & Co. KGaA
Head of Corporate Communications:
Ernst Primosch, Corporate Vice President

Photo material available for download at http://henkel.com/press. For
further details on the figures for the third quarter, please go to:
http://www.henkel.com/ir

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end of announcement euro adhoc
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ots Originaltext: Henkel AG & Co. KGaA
Im Internet recherchierbar: http://www.presseportal.de

Further inquiry note:

Irene Honisch

Assistent Corporate Communications

Tel.: +49 (0)211 797-5668

E-Mail: irene.honisch@henkel.com

Branche: Consumer Goods
ISIN: DE0006048432
WKN: 604843
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