Beiersdorf Handles Slack Demand by Luring More Men to Niveaby
Nivea and beauty products accelerated in second half
German personal-care maker says 2016 foundation 'solid'
Beiersdorf AG reported 2015 revenue that met analysts’ estimates after the German maker of Nivea skin cream raised prices and lured more male shoppers to overcome lackluster demand.
Sales were 6.69 billion euros ($7.27 billion), the Hamburg-based company said in a statement Thursday, compared with the 6.68 billion-euro average of analyst estimates compiled by Bloomberg. On an organic basis, excluding the effects of currency shifts, acquisitions and disposals, revenue rose 3 percent, matching the median of 15 estimates.
Chief Executive Officer Stefan Heidenreich has used brand extensions into men’s products and women’s razors to jog growth amid tepid consumer spending in Europe. A price increase for its flagship Nivea line has also helped. The company had targeted 3 percent to 4 percent organic sales growth last year.
“Men’s remains strong and the innovations at the low end continue to deliver,” Liberum analyst Robert Waldschmidt said. The company is also benefiting from higher prices and gaining market share in Brazil and other regions.
The shares were little changed at 81.48 euros at 9:17 a.m. in Frankfurt. Beiersdorf has held up better than the German benchmark index so far this year, down 3 percent through Wednesday compared with a 7 percent drop in Germany’s benchmark DAX Index.
Adjusted earnings before interest and taxes as a proportion of sales “significantly exceeded” 2014’s 13.7 percent profit margin, meeting the company’s guidance. Beiersdorf plans to report its full financial results for last year on Feb. 17.
Sales of Nivea, Eucerin and La Prairie beauty products accelerated in the second half of the year despite “challenging economic conditions,” the company said. Consumer-unit organic sales rose 3.6 percent last year, including a 5.7 percent gain in the back half of the year. The company’s Tesa adhesives unit posted 0.4 percent organic growth last year.