Q1 Sales Rise at Beiersdorf As Nivea Gains 10%
The performance is attributable to initial successes recorded by the new corporate strategy, the company said. In addition, Beiersdorf said it also benefited from a positive overall market trend in the first three months of 2012 after the weak business performance seen in Asia and Europe in the first quarter of the previous year. Positive calendar effects also contributed to the sales increase.
In the consumer business segment, Beiersdorf increased organic sales by 6.8% in the first three months of the current fiscal year.
Sales of the Nivea brand rose 10.1%, while Eucerin generated sales growth of 7.8%, continuing its strong prior-year performance. La Prairie recorded a decline in sales of 1.2%.
The global consumer markets turned in highly mixed performances. Europe recorded a 4% rise in sales. Germany saw 6% growth after a weak prior year. In Western Europe, sales grew by 1%, while 10.3% growth was registered in Eastern Europe, with Russia and Poland recording particularly dynamic performances. Sales in the Americas climbed 9.7%, with Beiersdorf’s Latin American operations being particularly successful (up 16%). Sales in North America were up slightly at 0.6%. The company recorded a 12.7% increase in sales in the Africa/Asia/Australia region.
Reckitt’s Focus on Big Brands Pays Off
• Reckitt Benckiser’s focus on its core “power brands” and emerging markets is working, as its Q1 sales rose 4%, slightly ahead of its 3.8% estimate. For the quarter, sales came in at $3.8 billion at current exchange rates.
“These results give us the confidence to reiterate our 2012 target of like-for-like net revenue growth of 200 basis points above our market growth rate of 1-2%. We also expect to maintain full year operating margins,” said the new chief executive Rakesh Kapoor, who took over last September after Bart Becht’s departure.
Personal Care Sales Rise 8% To $2.4 Billion at K-C
In the personal care segment, sales increased 8% to $2.4 billion. Operating profit rose 3% to $399 million. The improvement included benefits from sales growth and cost savings, partially offset by input cost inflation and increased marketing, research and general expenses.
Sales in North America increased 1%, while sales in Europe rose 4%. Sales increased about 17% in K-C International. Sales volumes were up 12%, with double-digit growth in each major region (Asia, Latin America, and the Middle East/Eastern Europe/Africa). Volume performance was strong in a number of markets, including Australia, Brazil, China, Israel, Russia, South Africa, South Korea, Venezuela and Vietnam.
RBC Capital Markets Cuts RatingOn Procter & Gamble’s Stock
• RBC Capital Markets downgraded Procter & Gamble Co to “sector perform” from “outperform,” expressing doubts over the management’s ability to execute a recent plan to cut costs and drive growth for its key businesses. The downgrade comes after the world’s largest household products maker lowered its growth forecasts for the second time in two months and unveiled plans to cut costs and focus on its core businesses.
“We no longer have the conviction that PG can pull this off with near flawless execution,” wrote analyst Jason Gere. “It sounds right and we agree with management’s decision to focus on the core but we aren’t certain that we have seen the end of missteps over the next year.”