Aerospace Adhesives Represent a Bright Spot for Henkel in Challenging 2019 Second Quarter
Henkel’s Adhesive Technologies business unit reported a slightly negative organic development in the second half of 2019, with sales down 1.2% to €2.4 billion (~ $2.7 billion).
Henkel recently announced its financial results for the second quarter and first half of 2019. In the second quarter, Henkel reports that it was affected by an increasingly difficult market environment. Sales were nominally and organically almost on the prior-year level. For the first half of 2019, Henkel achieved a slightly positive organic sales development, while margin decreased—in line with expectations following the announcement of increased growth investments at the beginning of the year.
“The development in the second quarter was mainly characterized by a significant decline in demand in key industries such as the automotive industry,” said Hans Van Bylen, CEO. “This particularly affected our industrial business. Nevertheless, our Adhesive Technologies business delivered a robust performance, achieving sales almost on prior-year level and an excellent EBIT-margin.”
At €5.1 billion (approximately $5.7 billion), sales in the second quarter 2019 were essentially flat compared to the 2018 second quarter. Organic sales, which exclude the impact of currency effects and acquisitions/divestments, were down by 0.4%. The contribution from acquisitions and divestments amounted to 0.5%. Currency effects had a negative impact of -0.5% on sales.
The Adhesive Technologies business unit reported a slightly negative organic development, with sales down 1.2% to €2.4 billion (~ $2.7 billion). Particularly positive was the development of solutions for the aerospace industry, which reportedly recorded double-digit growth in the second quarter.
In the first half of 2019, Henkel generated sales of €10.1 billion (~ $11.3 billion), an increase of 1.1%. Organic sales growth was 0.1%. Foreign exchange effects contributed 0.4% to sales. Sales declined slightly (1%) for the Adhesive Technologies business unit in the first half.
Henkel reports that it does not anticipate industrial demand to increase in the second half of the year, in contrast to previous expectations. The company anticipates group organic sales growth of 0-2%. For Adhesive Technologies, Henkel expects organic sales growth of -1-1%.
“We pursue a long-term strategy with clear priorities and ambitious goals,” said Van Bylen. “Our investments in brands, technologies, innovations and digitalization underpin our commitment to sustainable profitable growth.”
Additional details are available at www.henkel.com.