Henkel has reported strong organic sales growth in the third quarter of 2020.
Based on preliminary figures, Henkel delivered organic sales growth of +3.9% in Q3. The beauty care division delivered strong organic sales growth of +4.3%. While the development of the organisation’s hair salon business was below the level of the same period in 2019 despite a recovery, the retail business achieved ‘significant’ growth in Q3, according to Henkel.
Thanks to continued strong demand for Henkel’s laundry and home care products, as well as ‘catch-up effects’ from Q2, preliminary figures for this division indicate ‘significant’ organic sales growth in Q3 of +7.7%.
Henkel CEO Carsten Knobel said: “Despite the continued challenging economic environment as a result of the coronavirus crisis, based on preliminary sales figures, Henkel delivered a strong organic sales growth of +3.9% in Q3. Sales reached around €5 billion and all business units contributed to the good performance.”
Based on the preliminary business performance in the first nine months of 2020, Henkel has provided new guidance for fiscal 2020, following the withdrawal of its full-year guidance in April 2020, due to the high level of uncertainty caused by the pandemic.
For the group, Henkel now expects organic sales growth of between -1 and -2% in fiscal 2020. Despite strict cost control, the earnings development in the full year will be more affected than the sales side, according to the organisation, due to the significant decline in demand in the industrial and hair salon sectors, as well as higher growth investments in marketing, advertising, digitalisation, and IT.
“The organic sales development in Q3 reflects our robust, diversified portfolio, with successful brands and innovative technologies for our customers in the industrial and consumer goods business,” said Knobel.
“We are particularly pleased that all our business units showed a positive development. This was partly due to catch-up effects from Q2, which was heavily burdened by the coronavirus pandemic.
“We expect to feel the negative effects of the pandemic in the fourth quarter as well, but in our forecast for the year, we are not assuming a further extensive lockdown, as we saw in many countries especially in Q2.
“All in all, we are convinced to be on the right track with our strategic focus on purposeful growth and to emerge stronger from the crisis. Our special thanks to go to our employees around the world, whose great commitment is making a decisive contribution to this.”