Nov 6, 2014
Beiersdorf confirms 2014 outlook, shares rise
Nov 6, 2014
FRANKFURT, Germany - Germany's Beiersdorf, maker of Nivea skin cream, confirmed its outlook for 2014, boosting its shares, even as negative currency effects wiped out revenue growth overseas and as it took an impairment charge at its China business.
Third-quarter earnings before interest and tax fell by more than a quarter to 156 million euros, it said on Thursday, missing analysts' expectations.
However, Beiersdorf still sees its full year EBIT margin - operating profit as a percentage of sales - above 13 percent after 13.2 percent in 2013, pointing to expected consumer spending in its home market of Germany.
"We are anticipating a cautiously positive trend overall for Europe as a whole," Beiersdorf, which also makes La Prairie luxury skin care creams and Labello lip balm, said of expected macroeconomic developments.
"In Germany, we are assuming higher growth than in the rest of Europe in the current year, driven by consumer spending and capital expenditure."
Europe contributes more than 55 percent to Beiersdorf's group sales.
Beiersdorf's shares, which have lost more than 10 percent since the start of the year and have underperformed the sector , rose 5.1 percent at 0834 GMT. They were among the top gainers of the German blue-chip index Dax, which was down 0.1 percent.
The world No. 5 in beauty and personal care products said it took an impairment charge of 66 million euros at its Chinese hair care business as it adjusted its long-term sales and earnings outlook for the division.
In August, Beiersdorf said that the Chinese market was cooling down dramatically, which has been echoed since by other companies.
Rival Unilever has reported decreasing consumer demand and a tougher competition from local rivals in emerging markets and said that it did not see any material improvement.
Emerging markets have taken a dive in recent months, with China facing what may be its worst slowdown in 24 years.
1 US dollar = 0.7996 euro
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