Beiersdorf Lifted by Strong La Prairie Sales

BERLIN, Germany — Beiersdorf beat its consumer product rivals on Tuesday by posting a 6.5 percent rise in first-quarter organic group sales, powered by its Tesa adhesives unit and La Prairie premium skin care brand, even as Nivea sales slowed.

The Tesa business, which makes adhesives for the automotive and electronics industries, saw sales rise 8.5 percent, while La Prairie jumped 56 percent, building on strong growth last year.

Beiersdorf shares were up 2.7 percent by 0803 GMT, making them the biggest gainer on the German blue-chip index. German rival Henkel, which reports quarterly figures on Wednesday and also makes adhesives, rose 0.9 percent.

Sales of the core Nivea brand came in at just 1.9 percent, which analysts said was the slowest rate for three years, likely due to weakness in Latin America, where group sales fell a nominal 14 percent in the quarter.

"We expect modest upgrades to consensus at constant forex but expect the Nivea result to be the talking point," said Jefferies analyst Martin Deboo, who rates the stock "hold".

On a conference call for analysts, Chief Executive Stefan Heidenreich said he saw light at the end of the tunnel in Latin America.

Quarterly sales, excluding exchange rate effects as well as the impact of acquisitions and divestments, came in at 1.81 billion euros ($2.16 billion), just ahead of average analyst forecasts, although nominal growth was just 0.4 percent due to the strong euro.

Beiersdorf has performed well against rivals Unilever, the maker of Dove products, and Britain's Reckitt Benckiser.

The consumer business, which makes Nivea and other skin care brands such as Eucerin, reported organic sales growth of 6.1 percent, but a nominal fall of 0.3 percent due to the strong euro wiping out gains in the Americas.

Sales of healthcare, which includes its Hansaplast and Elastoplast brands, fell 2.7 percent.

"Despite the current political and economic uncertainty throughout some regions, we look optimistically to the coming months and therefore confirm our forecast for 2018," Heidenreich said in a statement.

Beiersdorf reiterated its forecast for 2018 sales growth of around 4 percent, predicting Tesa will record sales growth of 3 to 4 percent and its consumer products division to grow 4 to 5 percent.

By Emma Thomasson; editors: Maria Sheahan and Jon Boyle.