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EANS-News: Henkel AG & Co. KGaA /

Geschrieben am 09-11-2011

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quarterly report/9-month report/Henkel

Düsseldorf (euro adhoc) - Organic sales growth between 5 and 6
percent expected for full fiscal 2011

Henkel continues solid performance in Q3

• Sales increase of 1.7 percent to 4,028 million euros (organic: +6.5%)
• Adjusted* operating profit: plus 4.7 percent to 541 million euros
• Adjusted* EBIT margin: plus 0.4 percentage points to 13.4 percent
• All business sectors delivered substantial margin increases
• Adjusted* earnings per preferred share (EPS): plus 6.3 percent to 0.85
euros
• Further double-digit increase in the growth regions (organic: +10.9%)

Düsseldorf, Germany - "Henkel continued its solid performance in
the third quarter. Despite the challenging market environment, we
outperformed once again our relevant markets in terms of organic
sales growth," said Henkel CEO, Kasper Rorsted. "All our business
sectors contributed to this growth, and with further double-digit
increases in our growth regions, we improved their share to 43
percent of our total sales. Despite higher raw material prices, we
managed to improve profitability in all our business sectors."

For the full fiscal year 2011, Rorsted provided the following
guidance: "The economic environment remains challenging. In
addition to intense competition and high raw material prices, the
debt crisis in the eurozone is bringing additional uncertainty
into the markets. Against this background, we will continue to
adapt our structures in order to respond more quickly and flexibly
to changes in our markets, and maintain strict cost control."
Henkel also slightly raised its guidance for organic sales growth in
2011: "We now expect organic sales growth for the full fiscal year
to be between 5 and 6 percent. In line with our previous guidance we
expect our adjusted EBIT margin to increase to around 13 percent
and adjusted earnings per preferred share by about 10 percent,"
Rorsted added.

Henkel´s sales in the third quarter of 2011 increased to 4,028
million euros, a rise of 1.7 percent compared with the prior-year
quarter. After adjusting for foreign exchange, sales improved by
5.7 percent. At 6.5 percent, organic sales, which exclude the impact
of foreign exchange and acquisitions/divestments - again showed
a strong increase.

All three business sectors contributed to this positive performance:
Laundry & Home Care registered encouraging organic growth of
3.8 percent, driven exclusively by price. The strong
organic sales growth at the Cosmetics/Toiletries business
sector was 5.6 percent, achieved through significant volume
increases. Adhesive Technologies attained strong organic sales
growth of 8.7 percent generated through both volume increases
and implemented price increases. As a result, Henkel was able to
further expand global market share in all three business sectors.

After allowing for one-time charges, one-time gains and
restructuring charges, adjusted operating profit improved by 4.7
percent, from 517 million euros to 541 million euros, with all
three business sectors contributing. Operating profit (EBIT)
totaled 451 million euros compared to 501 million euros in the
same quarter of 2010.

Despite the influence of higher prices for raw materials and
packaging, adjusted return on sales (EBIT margin) rose by 0.4
percentage points, from 13.0 percent to 13.4 percent. Return on
sales came in at 11.2 percent, following 12.7 percent in the
comparative prior-year period.

At -37 million euros, the financial result remained at the level of
the prior- year quarter. The tax rate amounted to 24.2 percent
(prior-year quarter: 26.1 percent). Adjusted quarterly net
income after deducting non-controlling interests amounted to
366 million euros compared to 349 million euros in the third
quarter of 2010, a rise of 4.9 percent. Net income for the
quarter was 314 million euros compared to 343 million euros in the
prior-year quarter. After deducting non-controlling interests of 7
million euros, net income for the quarter totaled 307 million
euros (prior-year quarter: 337 million euros). Adjusted earnings
per preferred share (EPS) rose by 6.3 percent to 0.85 euros
compared to 0.80 euros in the prior-year quarter. The nominal figure
was 0.71 euros compared to 0.78 euros in the third quarter of 2010.

The ratio of net working capital to sales was 8.0 percent, about the
same as in the prior-year quarter. Net debt as of September 30,
2011 amounted to 1,859 million euros, some 1 billion euros below
the level of the previous year and falling below the 2 billion
euro mark for the first time since the acquisition of the National
Starch businesses in 2008.

Business performance from January through September 2011

In the first nine months of fiscal 2011, Henkel increased sales
versus the prior-year period by 3.9 percent to 11,804 million euros.
After adjusting for foreign exchange, sales improved by 6.2
percent. At 6.6 percent, organic sales growth also came in
significantly above the level of the prior-year period. Adjusted
operating profit rose by 8.0 percent, from 1,414 million euros
to 1,528 million euros, with the Cosmetics/Toiletries and Adhesive
Technologies business sectors making a particularly significant
contribution. Operating profit (EBIT) increased by 5.5 percent,
from 1,344 million euros to 1,418 million euros. Adjusted
return on sales (EBIT margin) improved from 12.4 percent to
12.9 percent. Return on sales rose from 11.8 percent to 12.0
percent.

Adjusted net income for the nine months after deducting
non-controlling interests rose by 11.0 percent, from 922 million
euros to 1,023 million euros. Net income for the nine months came
in at 979 million euros compared to 889 million euros in the
prior-year period. After deducting non-controlling interests of
21 million euros, net income for the period totaled 958 million
euros (previous year: 869 million euros). Adjusted earnings per
preferred share (EPS) rose by 11.3 percent, from 2.13 euros to 2.37
euros. The nominal figure was 2.22 euros compared to 2.01 euros in
the prior-year period.

Business sector performance in the third quarter 2011

The Laundry & Home Care business sector increased organic sales by
3.8 percent. The positive price developments of the second quarter
were further accelerated with the result that organic growth in the
third quarter was entirely price- driven. Despite a slight
decline in the relevant markets, volumes remained at the level of
the prior-year quarter. In nominal terms, sales came in at 1,110
million euros compared to 1,123 million in the prior-year quarter.

Positive momentum in organic sales development emanated primarily
from the growth regions of Eastern Europe, Africa/Middle East and
Latin America. The Africa/Middle East region continued its
recovery following the political upheavals, contributing to
organic expansion with a high single-digit growth rate. Sales in
North America increased despite a further contraction in the
market. An improvement in sales was also achieved in Western
Europe, due particularly to continuing strong growth in
Germany. This positive sales performance in generally declining
markets led to a further increase in Henkel´s global market
share.

Adjusted operating profit increased by 1.6 percent to 155
million euros. Adjusted return on sales improved by 0.4 percentage
points to 14.0 percent. The third quarter was again characterized by
high raw material prices. However, by increasing its own prices and
with ongoing measures to reduce cost and enhance efficiency in
both production and the supply chain, the business sector
succeeded in largely offsetting the impact of rising material costs
on gross margin. Return on sales further improved as a result
of cost reductions. Operating profit totaled 125 million euros,
compared to 139 million euros in the prior-year quarter. The
third quarter again saw the Cosmetics/Toiletries business sector
continue its upward growth curve. As in the previous quarters,
organic sales growth significantly outstripped the relevant
markets, coming in this time at 5.6 percent. Despite the
persistently difficult and intensely competitive market
environment, the business sector was able to further expand its
market shares. With prices slightly below the level of the
prior-year quarter, organic growth was driven by significant volume
increases, backed up by a strong innovation program. Sales
totaled 860 million euros, 1.9 percent above the figure for the
prior-year quarter.

Sales increases were reported in each of the company´s regions. The
strongest rises and another double-digit growth rate were
registered in the growth markets of Eastern Europe,
Africa/Middle East, Latin America and Asia (excluding Japan).
Development in China was particularly dynamic with a strong core
business and numerous new product launches. Sales growth was also
achieved in the mature markets. Aside from substantial sales
increases in Western Europe, there were also positive developments
in North America, with expansion in our business there outpacing
the relevant markets.

Adjusted operating profit increased by 7.0 percent to 123 million
euros, and return on sales improved by 0.7 percentage points, rising
to a new high of 14.3 percent. Further margin improvement was
supported by ongoing measures to reduce cost and enhance efficiency.
Persistently high prices for raw materials and packaging could
be partially offset. Operating profit totaled 111 million
euros, compared to 113 million euros in the prior-year quarter.

Once again in the third quarter of 2011, the Adhesive
Technologies business sector significantly outperformed its
relevant markets, increasing sales organically by 8.7 percent
versus the prior-year quarter. This positive development was
driven by both volume increases and successfully implemented
price rises. In nominal terms, sales rose by 3.9 percent to
2,020 million euros, thus exceeding the 2 billion euro mark for the
first time in a quarter.

Growth was achieved in each of the business sector´s regions. In
addition to a significant increase in sales in the mature markets,
appreciable momentum was also once again generated in the emerging
markets, with Africa/Middle East and Eastern Europe - driven by
Russia particularly - once again exhibiting the highest growth
rates.

Adjusted operating profit again improved significantly versus the
prior-year quarter, by 8.6 percent to 291 million euros. As a result,
adjusted return on sales rose by 0.6 percentage points to 14.4
percent, with the substantial increases in raw material and
packaging prices being largely offset by the business sector
increasing its own prices as well as reducing costs and
enhancing efficiency. Operating profit totaled 254 million euros,
compared to 268 million euros in the prior-year quarter.

Regional performance

In the highly competitive market environment of the Western
Europe region, sales improved organically by 3.8 percent to
1,422 million euros. Organic growth also came in at 3.8 percent.
The main driver of this increase was sales growth generated in
Germany. Despite the increasing severity of the financial crisis
in Southern Europe, growth in Italy was particularly positive. Sales
in the Eastern Europe region rose by 4.2 percent to 775 million
euros. Organic growth was even higher at 10.3 percent. Among the
primary reasons for the improvement were the company´s
businesses in Turkey and the adhesives operations in Russia.
Although sales growth in the Africa/Middle East region continued
to be hampered by political unrest in some countries, a
double-digit organic improvement of 13.1 percent was
nevertheless achieved, with the adhesives business making a
particularly strong contribution. Sales of the region totaled
237 million euros compared to 229 million euros in the
comparable period of the previous year. Sales generated in the
North America region decreased by 4.6 percent to 699 million
euros, with foreign exchange rates exerting major negative impact.
Organically, however, sales rose by 4.0 percent despite the
sluggish consumer climate prevailing in the USA. The region of Latin
America recorded a sales increase of 5.4 percent to 273 million
euros. Organic growth came in at 11.0 percent, with business
performance in Mexico and Venezuela a major contributor. The
Asia/Pacific region saw sales increase by 1.2 percent to 586
million euros, albeit with developments in Japan exerting a
dampening influence. Organic growth in the region was 7.6 percent,
supported in particular by the double-digit rates of increase
achieved in China and India.

Sales expansion was again given a particular boost by the growth
regions of Eastern Europe, Africa/Middle East, Latin America and
Asia (excluding Japan). Sales increased by 3.4 percent to 1,713
million euros, with organic growth again double-digit at 10.9
percent. Total sales were boosted in particular by higher sales
generated by Adhesive Technologies and Cosmetics/Toiletries. The
share of sales attributable to these growth markets increased from
42 percent in the prior-year quarter to 43 percent this time.

Sales and profits forecast 2011

Following the first three quarters, Henkel is confident of again
outperforming its relevant markets in terms of organic sales growth.
The company now expects an increase in organic sales of between 5
and 6 percent (previous outlook: around 5 percent). Henkel
confirms its forecast for an adjusted return on sales (EBIT) of
around 13 percent (2010: 12.3 percent) and an improvement in
adjusted earnings per preferred share of around 10 percent. This
guidance is based on increases achieved in Henkel´s selling prices
and the ongoing adaptation of its structures to the constantly
changing market conditions. Through these activities and the
maintenance of its strict cost discipline, Henkel intends to more
than offset the effect on its earnings arising from increased raw
material costs.

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,
forecast 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 report for the third quarter of 2011 and other information with
download material and the link to the teleconference broadcast can be
found in our press folder on the internet at:
http://www.henkel.com/press/publication-report-q3- 2011-33938.htm

press@henkel.com

Further inquiry note:
Irene Honisch
Tel.: +49 (0)211 797-5668
E-Mail: irene.honisch@henkel.com

end of announcement euro adhoc
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company: Henkel AG & Co. KGaA
Henkelstr. 67
D-40191 Düsseldorf
phone: +49 (0)211 797-0
FAX: +49 (0)211 798-4008
WWW: http://www.henkel.com
sector: Consumer Goods
ISIN: DE0006048432, DE0006048408
indexes: DAX, CDAX, HDAX, Prime All Share
stockmarkets: regulated dealing/prime standard: Frankfurt, free trade: Hamburg,
Stuttgart, Düsseldorf, Hannover, München, regulated dealing: Berlin
language: English


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