Henkel (HEN) Q2 2024 earnings summary

Executive summary

• Achieved organic sales growth of 2.9% in H1 2024, driven by pricing and improved volume in both business units, with group sales at €10,813 million, a nominal decrease of 1.0% YoY.

• Operating profit (EBIT) rose 70.2% to €1,470 million; adjusted EBIT increased 28.4% to €1,610 million, with margin up 3.4pp to 14.9%.

• Adjusted EPS grew 30.5% to €2.78; net income attributable to shareholders surged 82.4% to €1,029 million.

• Strategic priorities advanced, including value-enhancing acquisitions, successful Consumer Brands integration, and portfolio measures.

• Full-year 2024 earnings outlook raised twice, with mid-term financial ambitions expected to be reached sooner.

Financial highlights

• H1 2024 sales: €10.8bn; organic sales growth (OSG) 2.9%.

• Adjusted EBIT: €1,610m (+28.4% YoY); adjusted EBIT margin: 14.9% (up from 11.5%).

• Adjusted EPS: €2.78, up 30.5% YoY (+32.9% at constant FX).

• Free cash flow: €772m, up €23m YoY; net financial position: €-1,440m, mainly due to acquisitions and dividend.

• Adjusted net income rose 30.0% to €1,163m; adjusted ROCE increased to 14.8%.

Outlook and guidance

• 2024 organic sales growth guidance: 2.5–4.5%; Adhesive Technologies: 2.0–4.0%; Consumer Brands: 3.0–5.0%.

• Adjusted EBIT margin guidance: 13.5–14.5% (previously 13.0–14.0%).

• Adjusted EPS growth: +20% to +30% at constant FX (previously +15% to +25%).

• Guidance reflects higher direct material prices in H2 and increased marketing investments for Consumer Brands.

• Consumer Brands EBIT margin guidance raised to 13.0–14.0% (up from 12.0–13.0%).