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Henkel's 4Q profit up nearly 11 percent to euro244M

Henkel's 4Q profit up nearly 11 percent to euro244M

Henkel KGaA's fourth-quarter profit rose nearly 11 percent, the German maker of soap, laundry detergent and other household products, including the famed U.S. Dial brand, said Wednesday.
Duesseldorf-based company also said it would lower its stake in American company Ecolab.
Henkel said it planned to invest some euro500 million (US$743.7 million) in an effort to improve efficiency through 2008 and beyond, with the goal of saving euro150 million (US$223.11 million) a year by 2011.
The company conceded that program would likely lead to the elimination of as many as 3,000 jobs. Henkel employs more than 51,000 workers worldwide.
Henkel earned euro244 million (US$362.9 million) in the October-December period compared with euro220 million a year earlier, ahead of the euro235 million (US$349.5 million) that analysts polled by Dow Jones Newswires had forecast.
Fourth-quarter sales slipped to euro3.19 billion (US$4.7 billion) from euro3.2 billion a year ago, and below the euro3.7 billion (US$5.5 billion) that analysts had predicted.
For the year, the company earned euro921 million (US$1.4 billion), up 7.7 percent from euro855 million in 2006. Sales rose 2.5 percent to euro13 billion (US$19.3 billion) from euro12.7 billion in 2006.
Henkel, which owns Dial Corp., said it would lower its 24.9 percent stake in Ecolab Inc., the St. Paul, Minnesota-based maker of cleaning and sanitation products, but did not say by how much or offer a timetable. Currently, Henkel's stake in the company is worth approximately euro2.5 billion (US$3.7 billion). Shares of Ecolab were up .27 percent to US$48.03 (euro32.29) in trading before the opening of the New York Stock Exchange.
Chief executive Ulrich Lehner said Henkel's annual results were a reflection of an improved sales momentum in its high-growth areas, including its laundry and home care sector, with growth particularly sharp in Europe, including markets in eastern Europe.
Sales of its cosmetics and toiletries also rose, with growth of 3.7 percent in Europe, the Middle East and Latin America.
In the U.S., sales were led by its Right Guard and Dial brands, leading to an annual operating profit of euro372 million (US$553.3 million) for the year.
"These results demonstrate the effectiveness of our strategy of focusing on our core businesses while striving for innovation leadership in each of our markets," said Lehner, who plans to step down in April when he reaches the company's retire age of 62. He will be succeeded by Kasper Rorsted.
Investors cheered the result, sending Henkel shares up by 2.8 percent to euro28.94 (US$43.05) in Frankfurt trading.
Andrew Wood, a senior research analyst at Sanford C. Bernstein, said the quarterly results and guidance for 2008 were not the main reason for the stock's rise, but said Henkel's announcement about its new efficiency program and its decision to lower the stake in Ecolab were the prime movers.
"Overall, our feelings about today's reporting are mixed. The (fourth-quarter) results were generally weaker than we had hoped _ although better on earnings per share _ and better than management reported on organic growth!" Wood wrote in an e-mail to investors. "But the news on Ecolab and further restructuring activities is positive."
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On the Net:
http://www.henkel.com


Updated : 2021-05-10 07:53 GMT+08:00