Below is a look at the company's 2019 highlights, recent acquisitions, best-selling brands and latest innovations.
- Hans Van Bylen, chief executive officer
- Jens-Martin Schwärzler, executive vice president, Beauty Care
Personal Care, Hair Care, Body Care including:
- Schwarzkopf & Henkel, Schwarzkopf
- Zotos, Indola, Clynol
- Seah Hairspa, BC Bonacure, Clynol
- Dial, Fa, Aok, Diadermine
- got2b color
- Dial antibacterial hand soap with Mint Shea scent
After a banner fiscal 2017, Henkel’s 2018 numbers slipped 0.6% despite overall organic sales posting +2.4% growth.
Beauty sales rose 2.1% to $4.7 billion and comprised 20% of the company’s overall sales. Apart from the global hair colorants category, all of the company’s relevant beauty categories achieved positive market growth.
Henkel reported that its professional hair salon market continued to be characterized by intense competition in 2018, especially in the mature markets; however positive growth came mainly from product innovations such as those from its 120-year-old Schwarzkopf Professional brand, which added new products to the Igora and BlondMe lines. Hair color sales were also strong, as were market share gains across all regions, and were reported to have outperformed the market thanks in part to the company’s new brands like got2b Color, and existing brands such as Syoss Color. Henkel’s prowess in the segment gave the company leverage to further expand its position as the world’s No. 3 company in the professional hairdresser market.
Although the number of sites in Henkel’s beauty care production network held fast at 11, the company expanded its Latin America and U.S. sites to better fit into its production network. It also reported expanding capabilities and technologies within emerging markets to ensure long-term growth. The company continued expansion in Eastern Europe, specifically at its Russian factory, increasing production capacity in hair colorants, liquid products and aerosols. Henkel also increased capacity at sites in North America and Europe.
In July, the company opened its first Beauty Care Lab in Dubai, one of 22 global R&D centers, with the aim of leveraging its German technologies to cater to regional consumers’ needs while ensuring quality and regulatory compliance. Henkel also opened a Beauty Insights center in Düsseldorf that will be tasked with interpreting consumer product usage into the design and development of new products.
In November, Henkel launched Nature Box, a new hair and body care brand centered on cold pressed oils from coconuts, avocados, apricots, almonds, and macadamia nuts, and other ingredients that are sustainably sourced. Nature Box spans 22 items, including 11 hair care and 11 body care products. The full product portfolio includes shampoo, conditioner and treatments for hair care, as well as body wash, body lotion, body butter and liquid hand soap, and all products are packaged and labelled to encourage consumer recycling.
News of Note in 2019
Henkel’s beauty care segment sales fell in both Q1 and Q2 2019, dropping -2.2% and -2.4% to about $1.1 billion respectively. Nominally, sales in Q2 were -3.2% below prior-year level reaching about $1.1 billion. The company said it expected the Beauty Care business unit to develop below initial expectations for the year. Henkel had previously expected organic sales growth in the realm of 2-4% but adjusted its expectation to reflect an organic sales growth of -2-0%.
“The development of the Beauty Care Retail business was significantly below our expectations. On the one hand, this was due to not satisfying developments in mature markets such as North America and Western Europe. In China, the retail business was impacted by ongoing stock adjustments. In addition, marketing and sales expenses were higher overall,” commented CEO Hans Van Bylen. “The Professional business, however, continued its strong performance.”
In June, Henkel reported it would pour $19 million into an expansion plan for its West Hazleton, PA facility, enabling the company to open a new production line for both Dial body wash and Dial liquid hand soap.
On the packaging front, in April, Henkel Beauty Care launched new products from Fa and Nature Box in packaging made from 100% recycled plastic. The products were launched in the German market. And in August, the company announced it would make its EasyD4R software tool publicly available. The tool is capable of determining the recyclability of new packaging quickly and reliably.
Read Next: Avon Products Inc. is #14