Corporate Sales:

$23 billion

Beauty Sales:

$4 billion

Key Personnel:

• Carsten Knobel, CEO
• Marco Swoboda, executive vice president finance (CFO), purchasing and global business solutions
• Wolfgang König, executive vice president beauty care
• David DiBernardino regional head, Consumer Beauty Care North America.

Major Products/Brands:

Barnängen, Dial, Fa, Hawaii, Le Chat, La Toja, Magno, N.A.E., Neutro Med, Tone, Schwarzkopf, Syoss, Authentic Beauty Concept, Alterna, Blendax, Blonde, Color & Art, Diadermine, Gliss, Joico, Kenra, Naturelle, SexyHair, Taft, Zotos.

New Products:

Colour Alchemy hair dyes, Shiseido Professional (acquisition), Taft relaunch, Ingora Royal launch, Nature Box solid form and refill packs, Gliss 7sec Repair Kur, Gliss silicone-free hair care products.

Financial Summary:

Henkel’s overall corporate sales rose 4.2% to $23 billion in fiscal 2021 despite a very challenging business environment with unprecedented disruptions in global supply chains, a shortage of raw materials and strong material price increases.

Beauty Care, which makes up 18% of Henkel’s business, recorded sales of $4 billion and organic growth of 1.4%. While the recovery in the Professional business area had a positive effect following the closures imposed in the first waves of the pandemic, Beauty Care’s consumer business area was impacted in particular by a normalization of demand—after strong increases in the previous year—in the body care category, causing a decline in performance. As a result, the Professional business achieved significant double-digit organic sales growth. By contrast, organic sales development in the Consumer business was negative.

The regional picture shows that sales growth was in the double-digit percentage range across all emerging markets with the exception of the Eastern Europe region, which posted significant organic sales growth. Both the Consumer and the Professional business areas contributed to the growth posted in all regions. By contrast, sales decreased in the mature markets. The double-digit percentage growth in the Professional business was unable to fully offset the negative performance especially in the North America region, which was significantly down year on year, mainly as a result of demand returning to normal in the Body Care category. Performance was also negative in the Western Europe region, whereas the mature markets of the Asia-Pacific region showed significant growth.

2021/2022 Highlights:

In 2021, sustainable packaging and expanding sustainable brands and product ranges was an area of focus for the consumer businesses of Henkel. This includes the group’s Beauty Care brands Nature Box and N.A.E. Additionally, Henkel aims to have 100% of its packaging be re-usable or recyclable by 2025.

In September 2021, Henkel, L’Oréal, LVMH, Natura &Co and Unilever joined forces to co-develop an industry-wide environmental impact assessment and scoring system for cosmetics products. The goal is to co-design an approach that is brand-agnostic, and which provides consumers with clear, transparent and comparable environmental impact information, based on a common science-based methodology. The objective is to improve the information that is available to consumers and enable them to make more sustainable consumption choices.

In October 2021, Henkel named David DiBernardino regional head, Consumer Beauty Care North America. DiBernardino will lead the Henkel Consumer Beauty business in the U.S. and Canada, with goals that include continuing the business' focus on building strong partnerships with retailers, meeting evolving consumer needs, advancing digitalization, and growing its eCommerce platforms to offer Henkel’s portfolio of personal care products to more consumers.

In February 2022, Henkel announced plans to merge its Laundry & Home Care and Beauty Care business units into one unit: Henkel Consumer Brands. The company started preparations for the integration process immediately and aims to have the new organization in place by the beginning of 2023. With the new business unit, Henkel will build one multi-category platform for growth, combining its consumer brands and businesses under one roof, including brands such as Persil and Schwarzkopf, also comprising the hair professional business. The merger is designed to drive growth and profitability for the consumer business and the company.

Also in February, Henkel signed an agreement to acquire Shiseido’s Asia-Pacific Professional Hair business, including leading salon-exclusive brands Sublimic and Primience. Shiseido will retain a 20% share in the business in Japan to support growth, while Henkel becomes a key player in the Asia-Pacific region. Henkel’s Professional Hair Care Business will be a part of its new multi-category platform.

In April 2022, Henkel announced that it will continue doing business in Russia for the time being despite the country’s invasion of Ukraine. The group, which has around 2,500 employees in Russia, stopped all investments as well as advertising and sponsoring measures in the country in early March, but CEO Carsten Knobel says that Henkel bears responsibility for its employees. “This is sometimes viewed very critically by the public. So, it is important to me to stress we are fully applying all applicable sanctions,” chairperson Simone Bagel-Trah told shareholders at the group’s annual general meeting.

In July 2022, Henkel expanded its largest and most technologically advanced logistics operations in North America at Bowling Green, Kentucky. The logistics hub underwent a $70 million upgrade over three years to integrate Industry 4.0 innovations to help optimize storage space, enhance efficiency, and drive digital automation. The state-of-the-art facility supports Henkel’s Laundry & Home Care and Beauty Care production, storage and distribution. Brands produced at the facility include Schwarzkopf hair care and Dial soaps.

Looking Ahead

Henkel has set the goal of becoming a climate-positive company by 2030 – 10 years earlier than previously planned. The group is committed to converting to CO2-free energy sources for its sites. It is also aiming to procure 100% of the energy required for its production processes from renewable sources by 2030. In 2021 Henkel already fully converted the first sites.

Considering high market uncertainty and volatility and the impact of further substantial increases in raw material and logistics costs, the company expects organic sales growth in the range of 2 to 4%, and an adjusted return on sales (EBIT margin) between 11.5 and 13.5% in fiscal year 2022.

Read Next: Colgate-Palmolive is #16