When it comes to annual results, Germany’s blue-chip companies are not averse to dolling up their more weakly performing segments. For example, companies are wont to explain significant chunks of their overall costs as “restructuring outlays.” With these costs subtracted, the tidied up operating costs look significantly better.
Beiersdorf, maker of Nivea cream and Elastoplast plasters, has again forgone the cosmetic approach. Like last year, the skincare company’s pre-interest and pre-tax figures (EBIT) are all natural. In fact, the firm has very little to conceal: its margin has increased by 0.6 percentage points to 15 percent and only narrowly trails Henkel, its giant German competitor. And its non-operating assets register at €3.2 billion ($3.4 billion) after deducting its non-operating liabilities.
Even ignoring these numbers, Beiersdorf is proving astoundingly stable. The company owns 9.99 percent of its own shares, making it well equipped to deal with a takeover bid. The Herz family, the company’s controlling shareholder, has kept dividend payments at a low level in spite of rising profits. The equity-to-assets ratio has risen by one point to 62 percent.
But at the shareholders’ meeting on April 20, small shareholders are likely to express their concerns. They think that Beiersdorf should increase its dividends, which are currently pegged at 70 cents per share. Given the highly stable positions of the majority of major shareholders, this plea is bound to fall on deaf ears.