Henkel Annual Report 2011 - Henkel AG & Co. KGaA Annual Report ...

Henkel Annual Report 2011 Foreword 3
revenues rose to 15,605 million euros. Adjusted 1
return on sales rose to 13.0 percent compared to
12.3 per cent in the previous year, while adjusted
earnings per preferred share increased by 11.3 percent
to 3.14 euros. All our business sectors
contributed to this successful performance with
profitable growth and further expansion of their
market shares.
We will be proposing to the Annual General
Meeting approval of a dividend payout of 0.80 euros
per preferred share, an increase of 11.1 percent
compared to the 0.72 euros in the previous year,
in line with our established dividend payout policy.
The excellent business performance and solid
finances of Henkel were recognized in the financial
markets. In the course of 2011, both Standard &
Poor’s and Moody’s increased Henkel’s credit rating
to our target level, highlighting in particular our
strong cash flow and our disciplined reduction of
net debt – down to a level below 2 billion euros –
since the acquisition of the National Starch businesses.
We fully delivered on our ambitious targets in 2011.
Sales, profits and market shares in nearly all our
business segments reached new highs. Based on
this solid foundation and strong performance, we
are very confident of achieving our 2012 targets
set in 2008.
On behalf of the Management Board, I would like
to extend my sincere thanks to all our employees
for their outstanding contributions in this difficult
economic environment. Their commitment and
their ambition to be the best in everything they
do provide the foundation for Henkel’s success,
as has consistently been the case during the last
135 years.
We are well aware of our responsibility toward our
employees. Following the tsunami and the subsequent
reactor incident in Japan, and also during
the flood disaster in Thailand and the political
unrest in the Middle East and North Africa, we
made great efforts to ensure the safety and welfare
of our employees and their families, providing
a broad range of supportive measures.
1 Adjusted for one-time charges/gains and restructuring charges.
Excellence is our Passion
Since the beginning of 2011, our commitment to
be the best in everything we do has been reflected
in our new claim, “Excellence is our Passion.”
We regard this as a performance challenge to ourselves
and a performance promise to our customers.
In this report we introduce selected examples
of how more than 47,000 Henkel employees live
up to this commitment – day by day, around
the world.
Growth through globalization
Our vision, “a global leader in brands and technologies,”
is reflected in our business strategy.
A major success factor in our performance in 2011
was the further expansion of our position in the
emerging markets, where we generate 42 percent
of our sales and employ 54 percent of our people.
It is a key element of our long­term strategy to
continuously strengthen our position in these
markets characterized by above­average growth.
For example, in 2011 we began construction
of our largest adhesives plant in Shanghai. Over
recent years, Henkel has been benefiting from
the increasing globalization of our businesses. This
shift generates new growth momentum and
enables us to better market our technologies
to industrial customers on a global scale while
growing our strong brands in local markets.
Focus on strong brands
We further strengthened our top brands in 2011
and now generate 42 percent of total sales with
our top 10 brands. Thanks to above­average
margins, these brands contribute significantly to
our profitable growth. Our top 10 brands in the
Cosmetics/Toiletries business sector generate
90 percent of its sales, in Laundry & Home Care
the figure is 81 percent and in the Adhesive Technologies
business sector the share is 54 percent.
In our industrial adhesives business we will be
further focusing our portfolio on established,
global brands.
42 %
of our sales generated
in the emerging markets.
42 %
of our sales generated
by our top 10 brands.