Beiersdorf has reported 7.1% organic sales growth for the first half of the year, driven by double-digit percentage growth in its flagship skincare brand Nivea.
As the German company said in a statement, Nivea 'led the way with a double-digit sales increase combined with growth across all key regions and categories. These positive results more than offset the recurring headwinds in the challenging luxury market, which were particularly evident in China'.
Sales Performance
Group sales rose to €5.2 billion in the first six months of 2024, from €4.9 billion in the same period last year.
Organic sales in its Consumer Business segment increased by 8.0% in the six month period, while EBIT in this division stood at €800 million, up from €700 million in the corresponding period last year.
Sales at key businesses Nivea and Derma grew by 11.1% and 8.3% respectively, while luxury brand La Prairie saw its sales drop 7% due to a strong decline in China's luxury skincare market.
The skincare company reiterated its 2024 forecast for group sales to grow by 6% to 8%.
'Outperform The Competition'
“Beiersdorf delivered again a strong performance in the first half of 2024," commented Vincent Warnery, chief executive. "Growing by 8.0% in sales, our Consumer Business continues to outperform its competition and strengthen its leading position in the skin care industry."
Warnery added that despite the current volatile economic and geopolitical environment, the company remains "fully on track to achieve the profitable growth target for the full year. With our focus on capturing geographic white spaces and delivering breakthrough innovations, showcased by our recently launched anti-aging innovation Epicelline, we are clearly underlining our ambition to be the best skin care company in the world. We look confidently to the future.”
Analyst Comment
Commenting on Beiersdorf's performance, Barclays analyst Iain Simpson said, " 140bp 2Q24 miss on Consumer OSG and a 100bp 1H24 Consumer margin miss is eye-catching, but from our conversations with investors many expected a soft top line after L'Oréal's numbers so we think it's the margin miss that will get more attention. At group level gross margins were up 150bp in 1H24, but EBIT margins down 110bp, the step up in SG&A was attributed to increased spend on marketing, R&D, and digitalisation."
Additional reporting by ESM
