Germany's Henkel posts 84% fall in Q2 net income

06 August 2008 08:17  [Source: ICIS news]

MUMBAI (ICIS news)--Henkel has posted an 84% year-on-year drop in its net profit to €38m ($58.4m), due to costs incurred relating to job cuts and raw material price increases, the German chemicals firm said on Wednesday.

For the quarter, the company’s sales rose 11.4% to €3.66bn, on strong performance in all business sectors, it added.

“We achieved highly encouraging second quarter organic sales growth, despite a difficult economic environment still characterised by significantly increasing raw material costs and a weak US dollar,” said Kasper Rorsted, the company CEO.

For the quarter, the company’s earnings before interest and tax (EBIT) fell 66.7% to €113m on restructuring charges.

“These charges relate primarily to a global programme for efficiency enhancement and the integration of the national starch businesses,” the company added.

For the full year period 2008, it expected to post organic sales growth of 3-5%, Henkel said.

“Henkel expects to increase operating profit adjusted for restructuring charges and one-time gains and charges (“adjusted EBIT”) at the lower end of the mid-teens percentage range (2007 base: €1.37bn),” it added.

($1 = €0.65)

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