EANS-News: Henkel AG & Co. KGaA /

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annual report/annual result/Company Information/Henkel

Düsseldorf (euro adhoc) - February 24, 2011

2012 financial targets reconfirmed - despite cost pressure in 2011

Henkel delivers record results in 2010

• Sales increase by 11.2 percent to 15,092 million euros • Organic
sales growth of 7.0 percent • Share of sales of emerging markets:
plus 3 percentage points to 41 percent • Adjusted* operating profit:
plus 36.5 percent to 1,862 million euros • Adjusted* EBIT margin:
plus 2.3 percentage points to 12.3 percent • Adjusted* earnings per
preferred share (EPS): plus 47.6 percent to 2.82 euros •
Significantly higher dividends proposed: plus 35.8 percent to 0.72
euros

Düsseldorf - "2010 was an excellent year for Henkel. For the first
time, we closed a financial year with an adjusted EBIT margin above
12 percent," said Henkel CEO Kasper Rorsted. "We have improved the
market positions of all our business sectors and have further
strengthened our top brands. We have also been able to further
expand our positions in the emerging markets. With these strong
results, we are well on track to achieving our 2012 financial
targets."

Looking forward to fiscal 2011, Rorsted said: "The economic
conditions remain challenging, especially in view of the highly
competitive environment in which we operate, and rising raw
material costs. We will continue to respond quickly and decisively
to changes in our markets and continue the transformation
process in our company. We are confident that we will once again
outperform our markets in 2011 and expect to achieve organic
growth of between 3 and 5 percent. We anticipate realizing an
increase in our adjusted EBIT margin to around 13 percent and a
rise in adjusted earnings per preferred share of around 10 percent."

Henkel´s sales in fiscal 2010 were 15,092 million euros, an
increase of 11.2 percent versus the prior-year figure. After
adjusting for foreign exchange, sales improved by 6.4 percent. In
organic terms, i.e. adjusted for both foreign exchange and
acquisitions/divestments, sales grew by 7.0 - a relatively strong
growth after 2009 which was impacted by the financial crisis.
This strong performance was supported by all Henkel business
sectors. Adhesive Technologies performed exceptionally well,
reporting an increase in sales of 11.8 percent. The
Cosmetics/Toiletries business sector continued its encouraging
growth trend, registering growth of 4.8 percent and thus
substantially outperforming the stagnating market. Laundry & Home
Care achieved organic sales growth of 1.5 percent in a slightly
declining market.

Operating profit (EBIT) increased by 59.5 percent, from 1,080 million
euros to 1,723 million euros. After allowing for one time gains (59
million euros), one- time charges (14 million euros) and
restructuring charges (184 million euros), adjusted operating
profit improved by 36.5 percent, from 1,364 million euros to 1,862
million euros. All three business sectors contributed to the
increasing profitability in 2010.

Return on sales (EBIT margin) grew significantly, from 8.0
percent to 11.4 percent. Adjusted return on sales rose from 10.0
percent to 12.3 percent.

The company´s financial result improved from -195 million euros to
-171 million euros. The rise in returns on pension plan assets had a
particularly beneficial effect on the net interest result, as did
the further decrease in net debt from 2.8 to 2.3 billion euros,
which helped to reduce interest expenses. The tax rate was 26.4
percent (previous year: 29.0 percent).

Net income improved by 82.0 percent, from 628 to 1,143 million euros. After
deducting non-controlling interests of 25 million euros, net income
attributable to shareholders of Henkel AG & Co. KGaA was 1,118 million euros
(previous year: 602 million euros). Adjusted net income after deducting non-
controlling interests increased by 47.9 percent to 1,217 million euros.
Earnings per preferred share (EPS) rose from 1.40 euros to 2.59 euros. The

adjusted figure was 2.82 euros compared to 1.91 euros in the previous
year.

The Management Board, Supervisory Board and Shareholders´
Committee will be proposing to Henkel´s Annual General Meeting to
approve significantly higher dividends of 0.72 euros per preferred
share and 0.70 euros per ordinary share.

Once again, good progress was also made in the management of
net working capital. Compared to the prior-year period, the ratio of
net working capital to sales improved by a further 0.9 percentage
points to 6.9 percent. After coming in at 1,462 million euros in
the previous year, the level of free cash flow was again very strong
at 1,508 million euros.

Business sector performance

The Laundry & Home Care business sector increased sales by 4.6
percent to 4,319 million euros. Organically, sales rose by 1.5
percent, with strong volume growth of 5.7 percent. Price and
promotional competition in all relevant markets led to a decline
in prices of 4.2 percent compared to the previous year.
However, Henkel was able to more than compensate for this
development through high volume growth.

From a regional perspective, the main sales growth was achieved in
Europe and Africa/Middle East, the latter posting double-digit
increases. Significant sales increases were also achieved in Western
Europe, in particular in Germany, France and Spain. Growth was also
generated in Eastern Europe, however, due to substantial price
reductions this region was unable to achieve the expansion rates
of previous years. In North America, the combination of
aggressive pricing and consumer reluctance resulted in a decline in
sales.

Operating profit rose by 8.2 percent to a record 542 million euros.
Reflected in this earnings improvement are positive volume
effects and successful measures introduced to reduce cost and
enhance efficiency. Adjusted operating profit increased by 6.2
percent to 562 million euros. Adjusted return on sales increased by
0.2 percentage points to a new record of 13.0 percent.

In the Laundry business segment, the strongest growth momentum was
generated by heavy-duty detergents and fabric softeners. In Western
Europe, Henkel increased its market share with respect to heavy-duty
detergents despite the difficult trading conditions and intense
competition prevailing in the region. The primary contributor to
this expansion was the Persil brand, and especially the liquid
detergents. Also successful were the brands Spee and Weisser Riese,
both of which generated above-average growth as a result of new
powder and gel variants. In Western Europe, Eastern Europe
and Israel, the positive development of Henkel´s fabric
softener brands Vernel, Silan and Soad was supported by the
introduction of new products with innovative freshness pearls.

Organic sales growth in the Home Care business segment
continued to be generated primarily by dishwashing and WC products.
In the machine-dishwashing

segment, the products Somat 9 and Somat Perfect Gel made an especially strong
contribution. Henkel's hand-dishwashing products also registered strong growth
rates. In the WC products category, the introduction of the first rim block
with four active pearls made a particularly noticeable contribution to sales
growth.

Increasing sales by 8.6 percent to 3,269 million euros, the

Cosmetics/Toiletries business sector successfully continued its
growth trend of recent years. Organic sales grew by 4.8 percent. The
business sector thus again outperformed its relevant markets,
significantly further expanding its market positions.

From a regional perspective, good growth was achieved especially
in Western Europe, with a strong increase in sales particularly in
Germany. Sales in the emerging markets also expanded, with
double-digit growth rates being achieved in Africa/Middle East,
Latin America and Eastern Europe. By contrast, sales in North
America declined.

Operating profit rose by 6.1 percent to 411 million euros, and by
12.4 percent after adjusting for one-time gains and restructuring
charges, to a new record of 436 million euros. Adjusted return
on sales increased to more than 13 percent for the first time,
reaching a record high of 13.3 percent.

The Hair Cosmetics business achieved particularly strong growth.
Due to the launch of a series of successful innovations market
shares in the hair care, colorants and hair styling segments were
significantly expanded to new record highs. In addition to the
global expansion of the Syoss brand in new markets and
categories, particularly the innovation Perfect Mousse drove growth
in the colorants segment. The Body Care business was characterized
by innovations and further product launches under its core brands.
The Fa brand saw the launch of the Active Pearls series. In North
America, one of the region´s most successful body care innovations
of 2010 was launched in the form of the Dial NutriSkin series. In
order to further develop the global market for men´s products,
Henkel also launched its US brand Right Guard in Germany and Eastern
Europe.

In the Skin Care business, the focus remained on the development of
innovative anti-aging products. The introduction of the new
sub-line Novagen under the Diadermine umbrella brand
contributed to the enhancement of the brand´s position in the
anti-aging segment. In the Oral Care business, good results were
achieved with the new Theramed variants. The Hair Salon business
likewise contributed to the growth dynamics of the business sector
and further extended its position as the global number three in
a persistently difficult market environment. Following the
successful relaunch of the ammonia-free colorant, the Essensity
brand saw the introduction of a completely new line of hair care
and styling products. With innovative products, such as the
styling powder launched under the top styling brand Osis, the Hair
Salon segment was able to both attract new customers and
strengthen business with existing clients.

With the market environment recovering, the Adhesive
Technologies business sector saw sales increase by a substantial
17.4 percent to 7,306 million euros. Organic growth reached a new
record high of 11.8 percent.

In the mature markets of Western Europe and North America, Henkel
generated growth in the high single-digit range after negative
growth in the previous year. The emerging markets registered
double-digit percentage increases, with the highest growth rates
in the Asia-Pacific region.

Operating profit tripled compared to the prior year, reaching a new
record high of 878 million euros. Adjusted operating profit almost
doubled to 938 million euros. Compared to the previous year,
adjusted return on sales rose by 4.7 percentage points to 12.8
percent.

The Adhesives for Consumers, Craftsmen and Building business
performed well. Both, the business with consumers and craftsmen, as
well as the construction industry contributed to growth. Following
the adverse effects of the global economic and financial
crisis, the Transport and Metal business performed particularly
well in 2010. Sales in the General Industry segment also increased
substantially driven by the business with products for industrial
maintenance, repair and overhaul under the Loctite brand. Sales of
Packaging, Consumer Goods and Construction Adhesives also further
increased. The Electronics business benefited from the recovery
of the semiconductor industry. This segment generated the
highest sales increase of all our strategic business units.

Regional performance

In Western Europe, sales grew by 4.3 percent to 5,470 million
euros; the organic growth was 4.0 percent. This performance was
supported by all the business sectors, particularly Adhesive
Technologies which recorded an organic growth rate in the high
single-digit percentage range. Sales in Eastern Europe increased
substantially, by 13.7 percent to 2,649 million euros. Organic
growth was 7.2 percent, supported particularly by the
Cosmetics/Toiletries and Adhesive Technologies business sectors
both of which posted double-digit percentage increases. Sales of
the Laundry & Home Care business sector remained at the level of the
previous year. Africa/Middle East continued to develop
positively, with sales growing by 18.7 percent to 901 million
euros. Organic sales rose by 12.8 percent, to which all three
business sectors contributed with double-digit growth rates.

Sales in North America rose by 7.0 percent to 2,724 million
euros. Organic sales growth amounted to 3.5 percent thanks to the
results achieved by Adhesive Technologies, with sales of the Laundry
& Home Care and Cosmetics/Toiletries business sectors declining
compared to previous year. The region of Latin America
continued to perform very well, recording sales growth of 19.1
percent to 982 million euros. Organic sales growth of 9.8 percent was
supported by the Cosmetics/Toiletries and Adhesive Technologies
business sectors. The upward trend was most pronounced in the
Asia-Pacific region: sales increased by 30.8 percent to 2,168
million euros, with organic growth at 17.8 percent. The
Cosmetics/Toiletries and Adhesive Technologies business sectors
performed particularly well with double-digit growth rates. In the
emerging markets of Eastern Europe, Africa/Middle East, Latin
America and Asia (excluding Japan), sales rose by 19.9 percent to
6,132 million euros. Organic growth amounted to 11.8 percent,
keeping it in the double-digit percentage range. The increase was
supported in particular by higher sales generated by Adhesive
Technologies and Cosmetics/Toiletries. The share of sales
attributable to the growth regions increased from 38 to 41
percent.

Fourth quarter 2010

In the fourth quarter of 2010, Henkel increased sales compared to
the prior- year period by 11.5 percent to 3,729 million euros.
After adjusting for foreign exchange, sales rose by 5.7 percent.
Organic sales growth came in at 5.8 percent. Operating profit
increased by 29.0 percent, from 293 million euros to 379 million
euros. After allowing for one-time gains (16 million euros), one-
time charges (5 million euros) and restructuring charges (80
million euros), adjusted operating profit improved by 8.2 percent,
from 414 million euros to 448 million euros. Return on sales
(EBIT margin) increased from 8.8 percent to 10.2 percent. Adjusted
return on sales amounted to 12.0 percent after 12.4 percent in
the fourth quarter of 2009. Quarterly net income improved from 177
million euros to 254 million euros. After deducting non-controlling
interests

of 5 million euros, net income for the period totaled 249 million euros
(previous year: 170 million euros). Earnings per preferred share (EPS)
increased from 0.39 euros to 0.58 euros, while the adjusted figure rose from
0.64 euros to 0.69 euros.

Sales and profits forecast 2011

In view of the economic forecasts for the current year, Henkel anticipates that

the global gross domestic product will increase by around 3 percent.
Henkel is confident to once again outperform its relevant markets
in terms of organic sales, expecting an increase within the range
of 3 to 5 percent. This forecast is based on the company´s
strong competitive position, which has been consolidated and
further strengthened in recent years. Henkel has introduced a
number of measures which have had a positive impact on its cost
structure. In 2011 the company intends to further adapt its
structures to the constantly changing market conditions as
continuation of our commitment to strict cost discipline. All
these factors, together with the expected increase in sales, will
positively influence earnings development. Taking the 2010 results
as its basis, Henkel anticipates achieving an increase to around
13 percent (2010: 12.3 percent) in adjusted return on sales (EBIT)
and an increase in adjusted earnings per preferred share of
around 10 percent (2010: 2.82 euros).

This document 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 and
similar formulations. 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 forward-looking
statements.

Contact
Lars Witteck Wulf Klüppelholz

Tel. +49 211 797 - 2606 Tel. +49 211 797 - 1875
Fax +49 211 798 - 4040 Fax +49 211 798 - 4040

Henkel AG & Co. KGaA

The 2010 Annual Report and further information and download material
relating to fiscal 2010 can be found together with the link to the
live webcast of the press conference for fiscal 2010 can be found in
the press folder at our website address: http://www.henkel.com/press.

press@henkel.com

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
Corporate Communications
Tel.: +49 (0)211 797-5668
E-Mail: irene.honisch@henkel.com

Branche: Consumer Goods
ISIN: DE0006048432
WKN: 604843
Index: DAX, CDAX, HDAX, Prime All Share
Börsen: Frankfurt / regulated dealing/prime standard
Hamburg / free trade
Stuttgart / free trade
Düsseldorf / free trade
Hannover / free trade
München / free trade
Berlin / regulated dealing