Nivea made a growth spurt in the first half of the year. To the relief of parent company Beiersdorf, as Chinese luxury consumers, on the other hand, are hitting the brakes.
Compensation for China
Beiersdorf recorded 7.1% more organic sales in the first half of the year. The cosmetics group’s revenue was 5.2 billion euros, thanks to as much as 11.1% growth at flagship Nivea. The core brand grew “in all key markets”, but especially in emerging markets and home market Germany.
Accounting for more than half of group sales at 2.95 billion euros, Nivea benefited from both volume growth and price increases. The results thus “more than compensated for ongoing headwinds in the challenging luxury market, particularly in China”, CEO Vincent Warnery said. Luxury label La Prairie is indeed suffering from declining consumer spending in China.
EBIT nevertheless fell from 852 to 838 million euros. Beiersdorf attributes this setback to frontloaded investments and marketing expenses, but for the rest of the year the group believes to be on track. Profit after tax remained more or less stable at 590 million euros.
