Henkel focuses on sustainable profitable growth
Based on Henkel’s strong business performance in fiscal 2017, Hans Van Bylen announced the payout of the highest dividend in the company’s history. He also confirmed the outlook for the current fiscal year 2018. “We are looking back on a successful business year. We reached a new milestone in sales, exceeding the 20-billion-euro mark for the first time. We also achieved new record levels for earnings and margin. We delivered profitable growth. That is why we propose to the Annual General Meeting a record dividend of 1.79 euros per preferred share,” said Hans Van Bylen. This represents an increase of 10.5 percent compared to the previous year.
Full year outlook for fiscal 2018 confirmed
Commenting on the expectations for the economic environment in the current fiscal year, Hans Van Bylen said: “Overall, the economic situation is good, but there are many points of concern. In Europe it is still not clear how Brexit will be implemented. This uncertainty is a burden on the economy.” The CEO also referred to the recent discussions about tariffs, trade restrictions and possible countermeasures: “This is not favorable to economic development worldwide.”
“Prices for raw materials and packaging are likely to continue to rise compared to the previous year,” Hans Van Bylen added. “Foreign exchange rate effects will also remain a major factor. We anticipate very high volatility in this domain. We expect the US dollar to weaken further against the euro compared to 2017. In addition, some currencies of importance to us in the emerging markets could weaken further.”
For the fiscal year 2018, Hans Van Bylen confirmed the outlook for the Henkel Group: “We are committed to delivering sustainable profitable growth. For the full fiscal year 2018, we expect to generate organic sales growth of 2 to 4 percent. With respect to adjusted return on sales (EBIT), Henkel expects an increase to more than 17.5 percent. Adjusted earnings per preferred share should increase by 5 to 8 percent.”
Addressing the delivery difficulties in the consumer goods businesses in North America during the first quarter of 2018, Hans Van Bylen said: “We very much regret that these problems have occurred. The causes have been identified and we are working on this with strong focus. We expect the supply chain situation to normalize in the course of the second quarter.”
Implementation of strategic priorities
“We are pursuing a compelling ambition for Henkel and we are determined to achieve it,” said Hans Van Bylen. Therefore, Henkel has defined four strategic priorities: drive growth, accelerate digitalization, increase agility and fund growth. “Henkel aims to become more customer-focused, innovative, agile, and digital,” said Hans Van Bylen. At the same time, Henkel will continue to promote sustainability along the entire value chain and to further build on its long-standing position in sustainability.