German consumer chemicals group Henkel, maker of Persil washing powder, said Tuesday it is sticking to its full-year targets after sales and profits rose in the second quarter.
"Henkel continued its good performance in the second quarter of 2014. Despite the persistently difficult market environment, all our business units increased organic sales and further improved profitability," said chief executive Kasper Rorsted.
In the period from April to June, net profit grew by 5.5 percent to 441 million euros ($589 million).
Underlying or operating profit fell by 2.9 percent to 589 million euros on a 3.5-percent drop in sales to 4.137 billion euros.
"With a strong increase in organic sales, the emerging markets once again made an above-average contribution to growth. We also grew our business in the mature markets," Henkel said.
However, exchange rate developments continued to have a significant negative impact on sales, it added.
CEO Rorsted said the escalation of the conflict in Ukraine as well as the persisting political turmoil in the Middle East was expected to have a negative impact on the market environment.
"Therefore, we anticipate a slower growth of adjusted earnings per preferred share in the second half of this year compared to the first half," he said.
Nevertheless, despite the challenging environment, Henkel confirmed the outlook for 2014, the chief executive said.
The group was pencilling in organic sales growth of 3.0-5.0 percent and an operating margin of 15.5 percent, Rorsted said.
HENKEL AG & CO KGAA