Symrise cruises through Q1 on luxury fragrance sales, while Beiersdorf’s Nivea shows double-digit growth

26 Apr 2023 --- Symrise and Beiersdorf are off to a solid start for quarter one this year, with Nivea showing “outstanding” growth in all regions. Symrise has experienced a sales growth of 12.8% in the first quarter – a rise to €1.2 billion (US$1.32 billion) from last year. Meanwhile, Beiersdorf has experienced sales of €2.5 billion (US$2.76 billion).

“Despite the current volatile market environment resulting from the war in Ukraine and persistently high inflation rates in many countries, Symrise is well-positioned to continue its profitable growth path, especially by expanding capacity and increasing prices,” shares the company. 

Similarly, Beiersdorf attributes its performance to the rise in prices and volume of products.

“Successful start”
Expressing a “successful start into the new year,” Symrise has benefited from continued high demand and broad positioning on the market. “The company also recorded substantial organic sales growth of 10.6% (previous quarter 8.3%),” it shares. 

“Symrise seamlessly continued last year’s positive business development at the beginning of this year. Despite high inflation and continued market volatility, we are optimistic about the rest of the year and expect robust demand,” says Dr. Heinz-Jürgen Bertram, CEO at Symrise.

“Our diversified portfolio and our broad international positioning will also help us realize our growth potential and create lasting value this year. We therefore also confirm our outlook. For the current fiscal year, we aim for 5% to 7% organic sales growth and an EBITDA margin of around 20%.”Symrise’s Scent & Care business generated sales of €454.0 million.

Fine fragrances in lead
Symrise’s Scent & Care business includes fragrances, aroma molecules and cosmetic ingredients, which generated sales of €454.0 million (US $500.9 million) and grew by 8.3% compared with the previous year’s quarter – €419.3 million (US$ 462.5 million).

The Fragrance division’s luxury segment was noted for its “strong momentum.” Fine fragrances especially benefited from this – “generating growth in the high double-digit percentage range compared to the first quarter of the previous year.”

However, sales in Consumer Fragrances achieved single-digit growth and hygiene and cleaning products enjoyed great demand, shares Symrise.

Aroma and Cosmetic Ingredients
Symrise’s Aroma Molecules division saw a decline in sales due to the “difficult market environment.” An increasing competitive market from Asia has placed pressure and high inventories held by customers led to lower sales here. In particular, the menthols and terpenes product groups suffered lower demand than last year.

“Sales in the Cosmetic Ingredients division continued to develop strongly in the first quarter of the year, with organic growth in the double-digit percentage range. The most important growth drivers were the EAME regions and Latin America. Application areas with active cosmetic ingredients grew strongly,” shares the company. 

French companies Néroli and Romani – part of Symrise’s portfolio of acquisitions – contributed to the segment’s sales with a total of €15 million (US$16.5 million).

For this year, Symrise expects continual growth and increased sales by 5% to 7% annually (CAGR) until 2025 with an EBITDA margin of 20% to 23%. “Despite continued high raw material prices and high logistics and energy costs, Symrise is aiming for an EBITDA margin of around 20% in the 2023 fiscal year,” the company shares. 

Beiersdorf’s smooth startBeiersdorf has experienced “a very strong start” in 2023, and Nivea has had an “outstanding first quarter in all regions.” The Consumer Business Segment sales rose to €2.1 billion (US$2.3 billion).

“In addition to the consistently successful Derma business with the Eucerin and Aquaphor brands, Nivea had an outstanding first quarter, particularly in Europe and in the Emerging Markets,” shares the company.”

Nivea (incl. Labello) grew by 18%, Derma by 26.9%, La Prairie by 12% and Healthcare by 7.6%.

“Beiersdorf had an excellent first quarter. Our efforts to transform Nivea are paying off: Our brand icon grew in all regions and March was actually the best month in the brand’s history. With strong, double-digit sales growth, Nivea in Europe and in the Emerging Markets, along with our successful Derma business, compensated for a difficult quarter at La Prairie – one that was negatively impacted by the effects of the Corona lockdown in China,” says Vincent Warnery, CEO at Beiersdorf.

“That clearly shows that we’re like a four-wheel drive vehicle: If one wheel loses traction, the others will keep the vehicle moving forward. That gives us even greater stability and security in times shaped by volatility and crises.”

Raised price and volume
The sun care, lip care and deodorants categories led the growth of Nivea. Double-digit sales increases were seen in face care.Nivea grew by 18%, Derma by 26.9%, La Prairie by 12% and Healthcare by 7.6%.

Beiersdorf shares the growth was caused by price increases and a positive volume contribution. 

The Derma business recorded strong sales growth in Europe, shares the company, with consistent demands in key US markets. Sun care business in Latin America had significant growth in the first quarter.

“La Prairie saw its sales fall by 12% in the first quarter. This was due to challenging market conditions in China caused by the changes in COVID-19 policies, which significantly impacted the otherwise strong travel retail business,” explains Beiersdorf.

“Retail sales in China have, however, recovered significantly since February, starting with sales in brick-and-mortar retail and recently also in travel retail.”

Forecasting sales and margins
Beiersdorf anticipates higher sales and margins in 2023. For the whole year, the company expected organic sales growth in the mid-to-high single-digit range for the Consumer Business Segment.

For the full year 2023, Beiersdorf expects organic sales growth in the mid-to-high single-digit range for the Consumer Business Segment. It also aims to exceed the previous year’s EBIT margin by 50 basis points.

“Organic sales growth is expected to be in the mid-to-high single-digit range,” anticipates the Group. 

In related financial news, Moët Hennessy Louis Vuitton and Givaudan have managed to increase sales on the back of high-end products, which continue to generate enthusiasm among consumers. On the other side, BASF’s preliminary numbers for the quarter are “considerably lower than average analyst estimates,” with the company predicting a decline in sales.

PersonalCareInsights also reviewed the latest financials released by L’Oréal, P&G, Inter Parfums and Amyris.

Venya Patel