10. Henkel
Düsseldorf, Germany
www.henkel.com

Corporate Sales: $20.2 billion
Beauty Sales: $4.4 billion (cosmetics & toiletries)

Key Personnel: Kasper Rorsted, chairman of the management board; Carsten Knobel, chief financial officer; Kathrin Menges, executive vice president, human resources; Hans Van Bylen, executive vice president, cosmetics/toiletries.

Major Products: Schwarzkopf, Dial, Syoss, Indola, Clynol, Seah Hairspa, BC Bonacure, Clynol, Fa, Right Guard, Tone, La Toja, Coast, Dry Idea, Mont St. Michel, Aok, Diadermine, Licor del Polo, Antica Erboristeria, Vademecum, Theramed, Denivit.

New Products: Gliss Kur Ultimate Repair, Fa NutriSkin, Bonacure Oil Miracle, Syoss Mixing Colors, Palette Mousse Color, Taft Volume Powder, Got2b Powder’ful, Got2b Rockin’It, Dr. Caspari Hormoderm, Osis Style Shifters, Dial NutriSkin.

Comments: Despite the global financial problems that plagued them along with their competitors, Henkel managed to achieve a record year, with a healthy corporate net sales total of $20.2 billion, up 3.4% over the prior year. The company reported that it had significantly increased both sales and profits in all of its business units while continuing to strengthen its position and grow revenues in many areas. Emerging markets were key to growth—now generating 42% of Henkel’s corporate sales—and remain a crucial part of the company’s long-term strategy. An increase in selling prices also contributed to the bottom line.

Cosmetics and Toiletries accounted for 22% of the overall global total, or about $4.4 billion, up 4%.
“2011 was another very successful year for Henkel. Despite major challenges in a volatile economic environment, we fully achieved our ambitious targets—and even overdelivered on some of them. Sales and profits are higher than ever before,” said Henkel CEO Kasper Rorsted. “A major factor driving Henkel’s strong performance was the further expansion of our position in the emerging markets, where we once again registered double-digit growth. We made considerable progress in 2011, establishing a strong platform for Henkel’s future. Thus, we are very confident of achieving the targets for fiscal 2012 that we set in 2008.”

Henkel’s new CFO, Carsten Knobel

The strongest gains continued to be from the emerging markets of Africa/Middle East, Latin America and Asia (excluding Japan). In Cosmetics and Toiletries, as in all of its sectors, Henkel put the focus on its top brands. Obviously a successful strategy, its top 10 Cosmetics and Toiletries brands generated 90% of the category’s sales.

R&D plays a huge role at Henkel, and the company delivered a number of innovative launches, which served to improve market share in several categories. Major R&D efforts included: the use of treatment oils in a hair colorant offering, which helped to rebuild the hair structure and reduce split ends; development of a body wash formulation that not only cleans but prevents against body odor for up to 18 hours; and a development for hair gels that provides extreme hold.

Gliss Kur Ultimate Repair, a product range created for damaged and dry hair, launched globally in 2011, became the most successful launch in the brand’s history—within six months. Due to its efforts in R&D and its resultant innovations such as this, Henkel says the Cosmetics and Toiletries business sector continued on a positive revenue track to outperform a predominantly declining market.

In general, hair care performed well particularly in response to innovations in the Schwarzkopf and Syoss brands, the latter with its Beauty Elixir Absolute Oil. Henkel’s hair colorants business grew to record levels thanks to innovations such as Syoss Mixing Colors, a product with two harmonized shades for self-mixing, and Palette Mousse Color, the first foam colorant in Europe that mixes in a shaker.
The Hair Salon business also increased sales, due in part to innovative launches including Schwarzkopf Professional’s first hair care series designed for men. Bonacure Oil Miracle also generated healthy growth momentum.

Body Care was boosted with new entries from Fa, Dial and Right Guard brands. With Fa, the launch of NutriSkin increased Henkel’s market shares in Europe.

In Skin Care the development of innovative anti-aging products was at the root of growth, with products including Dr. Caspari Hormoderm, the first care product from Diadermine claiming to counter the effects of menopause on the skin aging process.

Looking ahead, Henkel says it will make major investments in production facilities for the manufacture of innovative products for the Cosmetics/Toiletries business. It also plans to continue on its strong sustainability path. In April, Henkel was named one of the “World’s Most Ethical Companies” by the U.S. Ethisphere Institute.

In the second quarter, things were looking better than ever, with Henkel reporting a 9.9% increase in net income and a 6.4% gain in sales, and raising its growth outlook for 2012. Company sales came in at $5.4 billion. The Cosmetics/Toiletries division reported a 4.5% sales increase to about $1.2 billion. All regions contributed to the sector's growth, with emerging markets in the lead.