Excellence in finance

Excellent financial performance is essential to securing our ongoing success. It allows us to continue to effectively fund growth. We have ambitious targets for the future, and we want to further improve all our key financials.

Employees discussing performance of key international financial market indicators.

The photo shows Dr. Michael Reuter (standing), Head of Treasury, discussing the latest performance of key international financial market indicators with his team. From the left: Renate Ohmen, Wenwen Liao and Derk Wetzold.

In September 2016, Henkel placed bonds with a total value of 2.2 billion euros on the capital market to fund the acquisition of The Sun Products Corporation. Henkel was the first DAX corporation in Germany to issue bonds with negative yields, which reflects the confidence that the market has in our financial strength, profitability and credit quality. Henkel has excellent “Single A” ratings, and we aim to maintain them going forward.

Financial KPIs are essential tools in successfully steering our business. Our Treasury department analyzes and assesses relevant key ratios in real time in order to make the right decisions in a volatile market environment. This requires both efficient processes and agile structures. Standardizing and digitizing the workflows of our global purchasing and supply chain activities and throughout the entire Finance function will reduce complexity, accelerate processes and increase efficiency.

In many respects, the placement of the bonds represented an historic milestone for Henkel, as well as for the capital market as a whole. This was the largest volume that Henkel had ever issued on a single day. And bonds in foreign currencies were issued for the first time, specifically in order to obtain beneficial terms on the global capital market. The Finance division pursued a very innovative issuance strategy in this respect.

In the placement, Henkel benefited from the favorable market environment for corporate bonds.

The bonds were significantly oversubscribed and aroused a great deal of interest from international investors.

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2/16/17

Interview with Dr. Michael Reuter

Dr. Michael Reuter, Head of Treasury, talks about the placement of bonds to finance the acquisition of The Sun Products Corporation.

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Strong basis for the future

We pursue a conservative and flexible investment and borrowings policy with a balanced investment and financing portfolio. The primary goals of our financial management are to secure the liquidity and creditworthiness of the company, together with ensuring access at all times to the capital market, and to generate a sustainable increase in shareholder value. A further important task of the Finance division is to work in partnership with the business units in contributing to the successful integration of acquisitions.

The development of our global supply chain organization is an important component in our ongoing strategy to improve our key financials. We aim to manage all procurement, production and transport processes for the three business units globally via a standardized platform. The development of a global supply chain organization with harmonized processes will further strengthen our competitiveness by delivering better customer service, greater process efficiency, and faster response times to changes in demand around the world. The success of the global supply chain is largely dependent on effective IT systems. Integrated Business Solutions (IBS) interlinks the IT department and the shared service centers. The holistic overview that networked processes allow serves to accelerate Henkel’s speed of response.