The consumer goods group Henkel significantly increased its sales in the first quarter and is now more optimistic about 2023.

The manufacturer of Pritt and Persil is "highly confident" that it will reach the upper end of its sales forecast for the year as a whole, said Group CEO Carsten Knobel. Henkel achieved the increase in sales primarily through price increases, but at the same time the Group sold fewer products. Knobel expects the trend to continue - Henkel has not yet fully passed on the price increases for raw materials, for example. Consumers must therefore be prepared for higher prices. However, the quantities sold will probably not increase compared to the previous year.

Large retailers such as Edeka and Rewe are also in price negotiations with brand manufacturers in the face of high inflation, with products disappearing from the shelves at times. On the other hand, in times of high inflation, consumers are increasingly turning to retailers' low-priced own brands. This also weighs on the sales of branded companies.

From January to March, Henkel recorded organic sales growth of 6.6 percent to around 5.6 billion euros, a record figure, as Knobel reported. The Düsseldorf-based company was able to implement price increases of around twelve percent, while volumes fell by 5.4 percent. "We have made a good start to the year - in an economic market environment that remains challenging," said the manager. He believes Henkel is on track to achieve its targets for the year, with sales at the upper end of the range. Henkel has forecast organic sales growth of between 1.0 and 3.0 percent. The adjusted return on sales (adjusted EBIT margin) is expected to be in the range of 10.0 to 12.0 percent.

However, competitor Beiersdorf expects higher sales growth in 2023. The Hamburg-based company increased its consolidated sales by 12.2 percent to 2.48 billion euros in the first quarter. The Nivea and Tesa Group raised its annual forecast at the beginning of April and expects sales growth in the mid to high single-digit percentage range. Beiersdorf CEO Vincent Warnery also announced a good start to the second quarter.

Henkel shares lost ground after the publication of the figures. The shares were down 1.4 percent at 72.98 euros around midday. Some had probably hoped for an increase in the outlook, said one trader. Henkel is growing less quickly than its competitors, criticized the Jeffries analysts.

(Report by Matthias Inverardi, edited by . If you have any questions, please contact our editorial team at berlin.newsroom@thomsonreuters.com (for politics and the economy) or frankfurt.newsroom@thomsonreuters.com (for companies and markets).)