Henkel Corporation sticks with glue and a slew of other consumer products. The North American unit of German giant Henkel KGaA, manufactures branded household and personal care goods in three categories: laundry and home care, cosmetics/toiletries, and adhesive technologies. Some of consumers' favorite brands are made by Henkle, including Dial soap, Soft Scrub cleaner, Purex laundry detergent, Right Guard antiperspirant, göt2b hair styling products, and Loctite and LePage adhesives and sealants. Customers are retail groceries and wholesalers and distributors. Henkel has some 50 manufacturing facilities and accounts for nearly 20% of its parent's worldwide sales. The founding Henkel family controls the business.
Henkel Corporation's operations consist of the North American market for laundry and home care (detergents and cleaning products), cosmetics/toiletries (products for the body, skin, and oral care, and hair salon business), and adhesive technologies (decoration and renovation products). The structure, which is supported by four US R&D sites, is intended to flex for growth in a positive market yet provide stability in a downturn.
Despite a modest improvement in the German parent's sales and operating profits in fiscal 2011 (ends December), operating profits generated by the North American unit fell by roughly 10% from the prior year on a slight slip in sales. Results were attributed to a combination of sluggish consumer spending and a poor housing market, paired with unfavorable currency exchange rates. Nonetheless, results followed a strong 2010, when year-over-year North American profits more than doubled and sales inched up 7%, buoyed by National Starch and Chemical's integration to the adhesives business, the largest acquisition in Henkel's history.
Henkel Corporation's rebound strategy counts in part on paring down its portfolio of lower-performing brands. To name a few, in late 2011 the company sold off its corrosion protection business to Ergon Asphalt & Emulsions (part of Ergon). In mid-2009 Henkel sold its Duck, Painter's Mate Green, and Easy Liner brands of tapes, office, and some houseware products to Shurtape Technologies, a longtime supplier. It also unloaded several smaller brands from its cosmetics and toiletries division that year.
Acquisitions are also expected to fuel growth. Among several additions, in January 2011 the German parent took over Schwarzkopf. The deal deepens Henkel's foothold in the US hair salon market. The buyout of National Starch and Chemical's adhesives and electronic materials businesses (2008) gave Henkel a worldwide presence, particularly in the US, and offered customers more choices of brands and products for case and carton sealing, hot melt and liquid labeling, and palletizing. – less