Beiersdorf Reports Strong First Half, Expects More Headwinds This Year

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PARIS — Beiersdorf AG posted a strong second quarter and first half, and confirmed guidance for full-year 2022, but said it expects additional headwinds.

The maker of Nivea, La Prairie and Tesa products on Thursday reported first-half sales of 4.48 billion euros, up 15.5 percent in reported terms and 10.5 percent on a like-for-like basis. The Hamburg, Germany-based company’s adjusted operating margin came to 15.9 percent.

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The results beat the financial community’s expectations.

“Implied [second-quarter] organic sales growth was 10.7 percent, compared to Visible Alpha consensus of 5.6 percent (Jefferies 5.5 percent),” Molly Wylenzek, equity analyst at Jefferies, said in a research note.

“Three-year growth CAGR stepped up materially to 5.2 percent,” wrote Bruno Monteyne, senior analyst at Bernstein AG. “The organic growth beat was evenly split between the consumer and adhesive [Tesa] divisions, with good growth in the main consumer brands despite headwinds [China lockdowns impacting La Prairie sales].”

The consumer division’s sales increased 17.3 percent in nominal terms and 11.7 percent on an organic basis to 3.64 billion euros. The Tesa branch’s sales were up 8.4 percent nominally and 5.4 percent organically to 838 million euros. Beiersdorf noted all geographic regions contributed to the performance, with significant growth generated especially in the Americas, where previous quarters’ momentum was maintained.

Sales of Nivea products increased 11.2 percent in organic terms in the six months ended June 30. Beiersdorf said Nivea posted “excellent” results around the globe and across its product portfolio in both the first and second quarters, in skin care as well as personal care. The sun, lip, face and body care categories drove the brand’s skin care segment, while deodorants and shower gels bolstered its personal care category.

“This strong sales performance was also boosted by significant gains in market share across the majority of categories,” Beiersdorf said. “Growth in the online business once again outstripped that in brick-and-mortar retail.”

The group’s derma brands Eucerin and Aquaphor registered organic sales growth of 26.6 percent in practically every region, with strong market share and sales gains in mature markets such as the U.S. and Germany, as well as in emerging markets like Latin America.

Prestige skin care brand La Prairie posted organic growth in sales of 1.8 percent.

“In the second quarter, the luxury brand was initially hit by COVID-19 restrictions and lockdowns in its core market, China,” Beiersdorf said. “However, La Prairie recovered once the restrictions there began to ease and was already achieving very good growth rates since June.”

In North America in the first half of 2022, La Prairie’s sales were advancing by strong double-digit percentage rates, according to Beiersdorf.

The group said overall, positive effects on the EBIT margin from strong sales growth in all regions were partly offset by higher commodity and transport costs.

“In an increasingly challenging environment, Beiersdorf carried strong momentum from the start of the year into the second quarter and posted double-digit sales growth at group level,” Vincent Warnery, chief executive officer of Beiersdorf AG, said in a statement. “We were also able to significantly improve our profitability. In the second half of 2022, we expect additional headwinds from economic and political tensions, and are confirming our full-year guidance.”

For 2022, Beiersdorf expects sales growth in the upper end of the midsingle-digit range and consolidated EBIT margin from operations on a par with 2021.

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