Nivea maker Beiersdorf raises profit forecast, trims sales
today Nov 4, 2015
Nivea skin cream maker Beiersdorf raised its margin guidance for 2015 after it posted a 55 percent increase in its third-quarter operating profit as new products and higher prices boosted profitability.
Earnings before interest and tax (EBIT) reached 242 million euros ($265 million) on sales up 5.7 percent to 1.633 billion euros, just shy of average analyst forecasts for 244 million euros and 1.67 billion euros, respectively.
"We are growing against the market trend and are advancing our position even under challenging conditions," Chief Executive Stefan Heidenreich said in a statement.
The world No.2 in skin care after L'Oreal trimmed its full-year sales growth target to 3-4 percent from a previous 3-5 percent, but said its EBIT margin from operations should "significantly exceed" the prior-year figure of 13.7 percent, after previously saying it would "slightly exceed" it.
That improvement was driven by its consumer division, which accounts for about 80 percent of sales and includes its skin and hair-care brands. It saw its EBIT margin improve to 14.4 percent in the first nine months from last year's 13.5 percent, while sales growth accelerated.
However, Beiersdorf cut its outlook for its Tesa unit, which makes industrial adhesives, saying it now expects the 2015 EBIT margin to be similar to last year from a previous aim to "slightly exceed", while sales should be at last year's level from a previous target for 1-3 percent growth.
Rival Henkel missed expectations for sales growth in the second quarter, mainly due to a slowdown in its adhesives business in North America and China.
Under Heidenreich, who took the helm in 2012, Beiersdorf has sharpened its focus around the Nivea brand, investing in new formulas and products. It has also raised prices over the past months to limit the impact of weakening currencies in countries like Russia and Latin America.
$1 = 0.9143 euros
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