Henkel Cuts 2022 Margin Target Amid Ukraine War; 1Q Sales Rose

By Joshua Kirby

Henkel AG & Co. KGaA said Friday that it expects a lower earnings margin this year than previously targeted, as raw material prices surge as a result of the war in Ukraine.

The German consumer-goods company now expects an adjusted operating margin of 9%-11%, from 11.5%-13.5% previously. This adjustment is due to rising raw-material prices and higher logistics costs stemming from the Russia-Ukraine war, as well as the effects of exiting operations in Russia and Belarus following the invasion, Henkel said.

The company nevertheless said it expects higher sales growth for the year than previously targeted, after first-quarter sales rose on higher prices and with a slight decline in volumes, it said. According to preliminary figures, the company's sales rose by 7.1% to 5.3 billion euros ($5.56 billion) in the quarter.

As such, Henkel said it is now aiming for full-year organic growth between 3.5% and 5.5% in fiscal 2022, compared with a previous targeted range of 2% to 4%.

The company will set out full first-quarter results on May 5.

Write to Joshua Kirby at [e-mail]; @joshualeokirby

(END) Dow Jones Newswires

April 29, 2022 03:13 ET (07:13 GMT)

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