Nivea sees risks in emerging markets

The Chief Executive of Beiersdorf AG, Stefan Heidenreich, was cautious about the Outlook for the second half of the year, after the manufacturer of Nivea cosmetics have announced yesterday sales growth below expectations by analysts.
"The markets are still slow," said Heidenreich, in Conference call yesterday. "We see some risks on the horizon, with emerging markets. How will this affect us? Who knows? "
The actions came to fall 4.6 percent in Frankfurt trading, the biggest fall since December day 2010.
The Beiersdorf announced yesterday 6.5% growth in sales for the first half of personal care unit, in the so-called organic criterion, below the average of analysts ' estimates, from 6.9%, according to DZ Bank. In Europe, sales fell 0.8%.
The company, which gets more than 80% of sales thanks to consumer brands as Eucerin and La Prairie, has been directing investments to emerging countries, because the demand in Europe remains low.
Unilever, maker of Dove soaps, had disclosed in July sales below estimates and alerted to the deceleration of growth in emerging countries and for the continuation of difficult conditions in the United States and Europe.
The Beiersdorf specified yesterday the predictions for this year. Designed to increase between 5% and 6% in revenue in 2013, compared to an increase of 3% to 4% in the market as a whole. Also predicted that the profit margin before taxes and interest will reach 12 or 13% this year.
Previously, the company had predicted that revenue would grow above the market and that would overcome the margin of 2012, which was 12.2%.
Heidenreich took the singer Rihanna Nivea ads in 2012, saying it would take the brand back to its roots. In 2013, the company redesigned the brand Nivea Men and released the skin conditioner in Europe under the brand Nivea, to win over women who do not use daily moisturizers.
These products "exceeded expectations" in the first half, said Chief Executive yesterday, adding that the company has a "great" structure of creation of new products.
In 2011, the company had announced plans to cut 1,000 jobs in three years, to reduce the annual expenditure until 2014. The company has already closed the cuts in Europe, said the Chief Executive. The resulting savings will be reinvested in the company's operations, rather than be directed directly to raise profits, he added.
The adjusted profit before interest and taxes for the second quarter rose from € 191 million to € 219 million in the comparison between the first quarters of 2013 and last year, according to Beiersdorf. The result topped the average estimate of 15 analysts consulted by Bloomberg, 215.5 million euros.