Henkel announced plans to merge its business units Beauty Care, Laundry and Home Care into one business unit as Henkel Consumer Brands. The company will start preparations for the integration process.
With the new business unit, the company will build one multi-category platform for growth, combining its consumer brands and businesses under one roof, including many iconic brands such as Persil and Schwarzkopf, also comprising the hair professional business.
Focus of Portfolio - Attractive Growth & Margin Potential
Henkel Consumer Brands will offer the opportunity to better capture the full potential for organic and inorganic growth and to focus on products with attractive growth and margin potential, beyond the measures of the active portfolio management completed by the end of 2021.
Further portfolio measures will include divestments or discontinuation of non-core brands and businesses as well as acquisitions in categories across the consumer space. First measures relating to the Beauty Care portfolio will be already implemented in the course of 2022.
By integrating both business units, the company will create more scale, allowing it to capture significant synergies, to become more efficient and agile as well as help the organization to act faster and more flexibly in a highly volatile environment. Synergies are expected in areas such as administration, distribution, marketing, and supply chain.
This will allow the new Consumer Brands business to free up resources for higher investments and better target these investments in strategic capabilities, for example, digitalization of R&D, e-commerce capabilities, or sustainability efforts around recyclable packaging. Synergies will be also used to strengthen the business unit’s margin profile.
New Leadership Structures
Under one leadership, the team will focus on advancing the entire consumer business, with leaner structures and faster decision-making. In the combined business, Henkel will offer bigger roles and opportunities, becoming an even more attractive employer for teams, leaders, talents, and new hires.
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I would also like to sincerely thank Bruno Piacenza. He looks back at more than 30 years at Henkel and has led our Laundry & Home Care business as Executive vice president for more than 11 years. Thanks to his passion and expertise, our top brands and the business have developed successfully over this period. We are very grateful for his commitment and contribution and are glad he will work with Wolfgang König to ensure an efficient transition process.”
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Under the leadership of Wolfgang König, the combined team will focus on advancing the entire Consumer Brands business, with leaner structures and faster decision-making. I would also like to express my personal appreciation for Bruno Piacenza and his many achievements in the course of more than three decades at Henkel,” added Henkel CEO Carsten Knobel.
The new business unit will be organized around customer and channel centricity, with an integrated approach for retailers, trade, or channel partners across all consumer categories. The company aims to have the new organization in place by the latest by the beginning of 2023.
New Financial Ambition
With its new multi-category platform and a joint consumer goods team, the company will drive growth and profitability for the consumer business and the Group. As part of its new mid-to-long-term financial ambition, the company aims for its Consumer Brands business to improve the growth and margin profile sustainably and to achieve 3 to 4 percent organic sales growth.
“Despite a very challenging business environment with unprecedented disruptions in global supply chains, shortage of raw materials, and significantly surging prices, we achieved an overall good performance with significant organic growth supported by all business units, a stable margin, and a very strong increase in earnings per share. This is the achievement of the global Henkel team which again went above and beyond to keep our businesses up and running to serve our customers and consumers around the world,” said Carsten Knobel.
Source: Henkel