Henkel AG & Co. KGaA

Henkel with Record High in Sales and Earnings

Düsseldorf/Germany (ots-PRNewswire) - -- Sales increased by 4.1 percent to 11.4 billion euro -- Operating profit improved by 8.3 percent to 857 million euro -- Net earnings at 404 million euro reached a new record high -- Dividends again increased: 0.87 euro per ordinary share, 0.93 euro per preferred share -- Strong start into the year 2000 -- Sales: 11.4 billion euro, plus 4.1 percent Despite a difficult economic environment the Henkel Group has mastered the challenges in 1999 very well. Sales of the Henkel Group increased by 4.1 percent to 11.4 billion euro in 1999 (1998: 10.9 billion euro). The economic recovery in Europe where sales increased by 2.2 percent to 8.0 billion euro, played a major role in this development. Businesses in North America increased sales by 7.8 percent to 1.9 billion euro, mainly due to the rise in the exchange rate of the dollar against the euro. In Asia the economic recovery and positive exchange rate effects were markedly reflected in the sales figure which increased by 20.9 percent to 926 million euro. Operating profit: 857 million euro Operating profit (EBIT) rose to a new record of 857 million euro, an increase of 8.3 percent. All business sectors contributed to this good performance. Return on investment improved from 12.4 to 13.2 percent. Net earnings: 404 million euro With an increase of 8.6 percent, net earnings reached a new record high of 404 million euro. Cash flow: 1,247 million euro Cash flow of the Henkel Group increased by 17.1 percent in 1999 to 1,247 million euro. The ratio of cash flow to sales was 11.0 percent. Earnings per share: Based on calculation in accordance with IAS earnings per ordinary share were 2.46 euro (2.28 euro), per preferred share 2.54 euro (2.33 euro). Dividends: Henkel's recommendation to the Annual General Meeting on May 8, 2000 will be for a dividend of 0.87 euro (1998: 0.79 euro) per share to be paid on the ordinary shares and 0.93 euro (1998: 0.84 euro) per share on the preferred shares. For per share to be paid on the ordinary shares and 0.93 euro (1998: 0.84 euro) per share on the preferred shares. For shareholders liable to tax at the full rate who are entitled to the tax credit, the gross distribution -- i.e. the cash dividend plus tax credit -- will total 1.24 euro (1998: 1.13 euro) on each ordinary share and 1.32 euro (1998: 1.20 euro) on each preferred share. Total dividends increase by 10.1 percent to 131 million euro. The payout ratio, i.e. the total dividends in percent of net earnings after minority interests, equals 36.0 percent (1998: 35.4 percent). Segment reporting: Henkel now reports on the following five sectors: Adhesives, Cosmetics/Toiletries, Detergents/Household Cleaners, Industrial and Institutional Hygiene/Surface Technologies and Chemical Products carved-out under the name of Cognis. This segment reporting is completely in conformity with IAS. The business sector Adhesives achieved a sales increase of 5.4 percent to 2.5 billion euro. Operating profit increased by 16.5 percent to 237 million euro. Sales of the business sector Cosmetics/Toiletries rose by 6.4 percent to 1.8 billion euro, while operating profit increased by 11.4 percent to 123 million euro. The business sector Detergents/Household Cleaners attained a sales increase of 2.3 percent to 2.6 billion euro. Operating profit improved by 7.6 percent to 177 million euro. The new business sector Industrial and Institutional Hygiene/Surface Technologies increased sales by 4.2 percent to 1.8 billion euro. Operating profit rose by 12.2 percent to 148 million euro. Sales of the Chemical Products business sector (Cognis) increased by 4.4 percent to 2.6 billion euro. Operating profit improved by 12.0 percent to 182 million euro. This figure includes both extraordinary gains from the disposal of the paper auxiliaries business and carve-out costs. Capital expenditures: 746 million euro Capital expenditures on property, plant and equipment, intangible assets and financial fixed assets in 1999 amounted to 746 million euro. Property, plant and equipment accounted for 440 million euro, intangible assets for 133 million euro, and financial assets for 173 million euro. In the year 2000 investments in property, plant and equipment will be at a similar level as those in 1999. The focus will be on the business sectors Adhesives, Detergents/Household Cleaners and Chemical Products. Research and development: 279 million euro Expenditure on research and development in the Henkel Group in 1999 was at 270 million euro, up by 11.6 percent compared with the previous year. As an average for the year, around 3,800 employees were employed in research, development and application engineering worldwide. Employees: 56.400 The increasing globalization of the Henkel Group is reflected in the development of personnel. In the last five years, the number of employees outside Germany has increased by 14,274 to a total of 40,984. The proportion of total employees located outside Germany as per end of 1999 was at 72.7 percent. The total number of employees decreased in 1999 by 223 to 56,396. Outlook The prospects for Henkel's businesses in the year 2000 are positive. Sales and earnings registered double-digit growth over the first two months. Henkel's markets will benefit most of all from the continued cyclical upturn in the chemicals sector, the sustained high level of activity in the automotive industry, the gradual improvement in the construction sector and the continuing rise in consumer spending against the background of stronger economic growth in Europe. For the year 2000 Henkel has chosen the motto "Year of organic growth". Growth through innovation, international roll-out of successful brand-name products and systems concepts, and time-to-market are central elements of this strategy. The measures introduced in the "Year of ROI" will further be pursued. Henkel's targets for the year 2000 are again ambitious. Another marked improvement in sales and earnings shall be achieved this year. Henkel is a worldwide operating specialist in adhesives, brand-name products and in systems businesses with affiliates in over 70 countries. Henkel is the number one producer of Adhesives, Surface Technologies and Industrial and Institutional Hygiene (jointly with Ecolab Inc.) on a worldwide scale. In Detergents it ranks second on Continental Europe and in Cometics Henkel holds the number three position in Europe. Cognis, the recently carved out chemicals business is the world's leading producer of Oleochemicals. ots Original Text Service: Henkel Group Internet: http://recherche.newsaktuell.de Contact: Investor Relations, Magdalena Moll, +49-2-11-7-97-16-31, or Waltraud Mueller, +49-2-11-7-97-72-78, both of Henkel, fax, +49-2-11-7-98-28-63 Web site: http://www.henkel.com Original-Content von: Henkel AG & Co. KGaA, übermittelt durch news aktuell

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