Beiersdorf Grows Despite China
Beiersdorf achieved strong organic growth in the first nine months of 2024, with a group sales increase of 6.5% year-on-year in organic terms, reaching €7.5 billion. The consumer business segment delivered organic sales growth of 7.3%, generating sales of €6.3 billion.
Key drivers of Beiersdorf Q3 growth include:
- Nivea delivered 9.4% organic sales growth by Q3, driven by both skin and personal care categories.
- Eucerin and Aquaphor achieved 8.8% organic sales growth, likely a result of the launch of the brand's anti-aging product, Epicelline.
- Strong performance in emerging markets contributed significantly to overall growth.
- Despite this, the luxury brand La Prairie faced challenges due to the ongoing weakness in the Chinese market (see below).
Regional Breakdown
Europe:
- Experienced a steady growth of 5.5% nominally and 5.2% organically.
- Western Europe contributed the majority of sales, with a growth rate similar to the overall European performance.
- Eastern Europe, however, saw significant growth, both nominally and organically, suggesting strong market penetration or product launches in that region.
Americas:
- Showed a modest growth of 3.7% nominally and 6.0% organically.
- North America, while contributing a smaller portion of overall sales, experienced a decent growth rate of 1.8%.
- Latin America, however, saw a more significant growth rate of 9.3%, indicating strong market potential and execution in that region.
Africa/Asia/Australia:
- This region exhibited the highest growth rate of 11.8%, both nominally and organically.
- This suggests potential opportunity for strong market penetration and successful new product launches in these regions.
Vincent Warnery, CEO of Beiersdorf, says, “In the first nine months of 2024, we continued to deliver strong growth in a market that remains dynamic. Looking at the third quarter, I am particularly pleased about fantastic double-digit sales increases in key areas of our business, namely our Derma brands, our North America business resurging after a challenging first half year and the outstanding performance of the Emerging Markets region, which was especially driven by strong NIVEA sales.”
Warnery adds, “The luxury market however, especially in China, continues to be challenging. Our anti-aging breakthrough innovation Epicelline managed to deliver exceptional sales results within just a few weeks after its launch in September. I am very proud of the entire Beiersdorf team for getting our Eucerin Epigenetic Serum off to such a great start.”
He concludes, “With a growing presence in over 30 countries already, we are well on track to make this our biggest product launch ever. Looking ahead, we expect strong performance overall in the fourth quarter to finish a very successful financial year in this dynamic market environment in line with our full-year guidance.”
Unilever Q3 Growth Drivers
Unilever's Beauty & Wellbeing segment delivered a strong performance with 6.7% underlying sales growth in Q3 2024, with a turnover of $19.7 billion with (2.8)% impact from currency and (1.5)% from net disposals.
The company's focus on volume growth, particularly in the beauty & wellbeing segment, has been a key driver of performance.
Key highlights from the 2024 Q3 results from Unilever include:
- The beauty and wellbeing segment delivered double-digit, volume-led growth, driven by a strong performance in health & wellbeing and continued positive momentum in Vaseline
- The personal care segment saw 4.4% underlying sales growth, with 3.1% from volume and 1.3% from price.
- The deodorant category grew to high-single digits, led by strong volume growth in Latin America and mid-single digit increases in Europe and North America.
- Skin cleansing category grew in the low-single digits, driven by volume increases in Europe and the US.
- Dove and Tresemmé continued to perform well in the hair care segment, with low-single digit growth.
Despite challenges in certain markets, Unilever's strong performance demonstrates its ability to adapt to changing consumer preferences across all regions, with key drivers being India and Africa, and challenges in China and Indonesia.
Regional breakdown:
India:
- Grew 2.3% with 3.4% volume growth.
- Price growth was negative due to a one-off tax benefit in the prior year.
Americas:
- North America: Grew 7.4% with 6.2% volume growth and 1.1% price growth.
- Strong performance in health and well-being and personal care.
Latin America: Grew 3.8% with 2.0% volume and 1.7% price growth.
- Strong performance in beauty and well-being and personal care, but slowed down by challenges in Brazil's powder market.
Europe:
- Grew 6.5% with 7.7% volume growth and a 1.0% price growth decline.
- Strong performance across all categories.
Hein Schumacher, CEO of Unilever, states, “Our full year 2024 outlook is unchanged. We continue to expect underlying sales growth (USG) for 2024 to be within our multi-year range of 3% to 5%, with the majority of the growth being driven by volume. Underlying operating margin for the full year is expected to be at least 18%, with increasing investment behind our brands. We expect the year-on-year margin progression in the second half to be smaller than in the first half.”
