Henkel Ag & Co Kgaa S/Adr

Good morning and welcome to Henkel Conference Call. For the duration of the call, you will be in listen only. If you would like to ask a question during the Q&A session, please press star and one on your telephone keypad. If at any time you need assistance, please press star and zero and you will be connected with an operator. I will now hand over to Leslie Ilken, Head of Investor Relations. Please go ahead, madam.

Good morning and a warm welcome to everyone joining Henkel's Q1 2026 results conference call today. I'm Leslie Iltgen, head of Henkel's Investor Relations. Today I'm joined by our CEO, Carsten Knoebel, and our CFO, Marco Svoboda. Carsten will begin with an overview of the key developments in the first quarter. Marco will then follow with a more detailed review of the company's financial performance. As always, Following the presentation, we will open up the lines and Carsten and Marco will be happy to take your questions. Before handing over to Carsten, please let me remind you that this call will be recorded and a replay will be made available on our investor relations website shortly after this call. By asking a question during the Q&A session, you agree to both the live broadcasting as well as the recording of your question, including salutation to be published on our website. Also, please be reminded that this presentation contains the usual form of disclaimer in regard to forward-looking statements within the meaning of relevant legislation. It can also be accessed via our website at hancock.com. As always, the presentation and discussion are conducted subject to this disclaimer. With this, it's my pleasure to hand over to our CEO, Carson Kilby-Carson. Please go ahead.

Thank you so much, Leslie. A warm welcome also from my side to everyone today joining our conference call. As always, we do appreciate your interest in our company and we look forward to answering your questions. After walking you through the key developments in the first quarter, we will elaborate on Henkel's business performance and the full year outlook in more detail. So let me move straight into the highlights of the first quarter. In Q1, we delivered good organic sales growth of 1.7% on group level, equally supported by both business units. We saw continued positive price and volume development in both business units. As a result, volumes have now been in positive territory for three consecutive quarters. Furthermore, We are making strong progress in executing on our M&A strategy in both business units, and we have recently signed five acquisitions with combined annual sales of around 1.6 billion euros. To date, we have already successfully closed three of these five transactions, whether that be LaRock, ATP Systems and Adhesive Technologies, and Not Your Mothers in consumer brands. I will elaborate in more detail on the acquisitions in a minute. In addition, we have successfully completed our 1 billion euros share buyback program by the end of the March, in line with the announced timeline. And finally, our full year 2026 guidance remains unchanged. As you are all aware, acquisitions are an integral part of our growth strategy. With the recently announced acquisitions, we are investing a total of nearly 5 billion euros and adding combined annual sales of around 1.6 billion euros. Overall, Expected sales growth of the assets we are acquiring is clearly above average. By 2030, we expect to realize synergies in the high single-digit range as a percentage of sales of the acquired companies, translating into an increase in adjusted ETS of at least 10%. We will provide further information once all transactions have been successfully closed. While we keep investing into our businesses organically and non-organically, we also let our shareholders participate in the company's success. Through the completed share-by-back program of a billion euros and dividends of more than 800 million euros paid for 2025, we have returned almost 2 billion euros to our shareholders over the last 12 months. In adhesive technologies, we successfully closed the transaction of ATP adhesive systems effective April 1st. With this acquisition, we are entering the highly attractive and fast-growing market for high-performance water-based specialty tapes, which currently grows at around 7% and are expanding our portfolio beyond liquid adhesives with solid solutions. Water-based specialty tapes show increasing market penetration and outperform the broader tapes industries with above-average growth rates by offering a more sustainable alternative to traditional solvent-based tapes. By increasing our offering and capabilities in the tapes market with a broader range of innovative bonding solutions, we create additional value for our customers and we drive further profitable growth. With the acquisition of Stahl, we are expanding into the specialty coatings market for flexible materials and we are adding a highly complementary portfolio that serves various customer segments to our business. This market shows attractive growth rates of 3-4%. Stahl also focuses on environmentally responsible water-based solutions, further underpinning our sustainability commitments. Building on valuable complementary technology and R&D capabilities and a know-how-based business model with a high degree of customization, this acquisition is a strong strategic fit for our adhesive technologies business and will enable us to bring more innovations to our customers. Together with the previous acquisitions of Kritica Infrastructure and Seal4Life, we are further strengthening and expanding our technology portfolio which is already the broadest in the industry, by adding attractive adjacencies. As a result, we are not only entering new markets, but we are also creating the basis for new technology-led opportunities in our core businesses, unlocking additional growth potential. By further reinforcing our technological agnostic approach, we can drive even more customer-centric innovation tailored to specific application and performance needs across industries. A strong example of how our broad solution portfolio positions us as the partner of choice for our customer is NASA's recent ATEMIS-2 mission, where we delivered industry-leading performance and reliability across structural integrity, thermal protection, surface technologies, and safety-critical ceilings. Overall, we are supporting space exploration with more than 20 mission-critical solutions engineered to withstand extreme environments and to enable highly demanding, one-of-a-kind applications. The proven performance of our Loctite solutions on the Orion spacecraft underscores the relevance of our materials for both today's and future space missions. Another great example of our technology leadership is in paper packaging, where we are expanding our coatings expertise to capture high growth opportunities in the packaging market. With advanced barrier and heat seal coatings, we are enabling our customers to shift from traditional plastics to recyclable paper-based packaging solutions. And furthermore, we are broadening our solution portfolio with our in-house packaging recycle lab, which offers comprehensive recyclability assessments for fiber-based packaging. Turning now to our consumer brands, where we are further expanding our hair business through attractive M&A opportunities with Not Your Mothers and with Olaplex. After having streamlined and cleaned up our portfolio over the past three years, we are now adding back size and scale with a brand that has historically grown clearly above market rates, further strengthening our footprint in North America. In the meantime, we successfully closed the acquisition of Not Your Mother's effective April 24th. Not Your Mother's is a leading and a fast growing hair care and styling consumer brand in the US and it allows us to expand our hair footprint in the largest global retail hair market which shows attractive growth rates of around 4%. Not Your Mother's brings a diversified channel footprint, including mass retail and e-commerce, creating attractive opportunities to accelerated growth in our consumer business. And finally, its complementary capabilities and deep hair expertise further strengthen our innovation engine and power insight-driven product development. With the acquisition of OLAPLEX, we are expanding our global presence in the premium hair care segment which also offers attractive growth opportunities with a CAGR of around 5%. Olaplex is a well-established, globally active premium channel hair care brand offering a portfolio of science-led high-performance products. It addresses a diversified premium channel mix across professional, specialty retail, and also e-commerce. With its strong scientific foundation, we see compelling opportunities for future growth and innovation. Over the last few years we have been significantly transforming our consumer brands portfolio through strategic refocus and more recently with targeted M&A. There is a clear focus on attractive categories. We have sharpened our brand focus and we are successfully executing on our M&A growth strategy. When looking at how our hair portfolio has evolved And considering all transactions will be closed, we will have expanded this business by around 1 billion euros since 2021. And in addition, our hair business has been growing above average over the last years. As a result, we now have a much more balanced portfolio. Our hair business, in the meantime, has nearly now the same size as our laundry care business, each accounting for around 40% of consumer brand sales. And at the same time, we have enhanced the attractiveness of our laundry care business through a clear focus on premium brands in combination with impactful innovations, for example, under our strong brands Persil and Pervol. With our strong brands, customer-centric innovations, and an almost balanced footprint in consumer and professional, we are building on a strong foundation to become the authority in hair. This ambition is underpinned by our strong growth performance with a CAGR of more than 6% over the last three years, outperforming our consumer brand business by more than 300 basis points. And finally, the continued strong growth dynamics of our top 10 brands are underscoring our sharpened brand focus. In Q1. The top 10 brands again delivered above average organic sales growth of around 5%, driven by a balanced contribution from growth, price, and volume, and we expect their share of sales, which currently accounts for around 60%, to continue to increase going forward. In this context, Let me also highlight the strong results of our premium laundry care brands Persil and Pervol mentioned before, a clear proof that our focus on premium brands with strong innovations pays off. On Persil, we delivered mid-single-digit growth in Q1. In 2025, Persil was the market leader in Germany, gaining 200 basis points in market shares. And Pervol achieved high single-digit growth in Q1, underpinned by strong market share dynamics with gains of 170 basis points globally in our active markets in 2025. And now, turning to our full-year outlook, which remains unchanged. For the group, we continue to expect organic sales growth of 1-3%, an adjusted EBIT margin in the range of 14.5% to 16%, and adjusted EPS to increase in the low to high single-digit percentage range. And with this, let me hand over now to Marco, who will lead you now through the key financials in more detail.

Yeah, thanks, Carsten, and good morning to everyone in the call, also from my side. And building on what Carsten already shared, let me provide some more color on the drivers of the group sales performance in the first three months of 2026. We delivered good organic sales growth of 1.7%, with both price and volume in positive territory. On group level, volume development contributed with 1% and pricing with 0.7%. Acquisitions and divestments reduced sales by roughly 2%, still reflecting the retailer brands divestment in North America, which was closed in April 2025. FX effects were a strong headwind of minus 5%, mainly due to the significantly weakened dollar and related currencies in comparison to Q1 last year. While Q1 came in below the full year guidance, we expect currency headwinds to moderate for the remainder of the year and to come in within the negative low single digit percentage range. In nominal terms, sales amounted to 5 billion euros. Turning to the drivers in the respective regions in more detail. Starting with Europe, where sales were down 3.4% year on year, reflecting weaker business performance in both business units. In adhesive technologies, markets remained muted across all business areas, and in consumer brands, particular laundry continued to face a challenging environment, while hair delivered above average growth. In North America, organic sales growth was positive, clearly driven by consumer brands, whereas adhesive technologies remained flat. Within adhesives, the good growth in mobility and electronics was offset by an adverse development in packaging and consumer goods, while craftsmen, construction, and professionals remained stable. In consumer brands, the development was driven by very strong growth in hair and significant growth in other consumer businesses, while laundry and home care remained below prior year. Moving on to Asia-Pacific, organic sales growth recorded 10.3% growth, supported by both business units. Double-digit growth in adhesive technologies was again driven by electronics and industrials, with packaging and consumer goods also contributing strongly. Consumer brands achieved very strong growth, led by hair, while laundry and home care posted good growth. India and Middle East Africa also showed double-digit growth of 12.8%, which was supported by both business units. And finally, in Latin America, sales were below prior year, due to adhesive technologies, while consumer brands showed good growth. Now back to the global level and now turning to adhesive technologies in more detail. In the first quarter, we achieved sales of 2.6 billion euros with organic sales growth of 1.7%. Overall, adhesive technologies showed good growth development in the first quarter, supported by positive pricing and positive volume. of 0.4% and 1.3% respectively. Organic sales growth came in slightly stronger than expected. Volume development was also supported by forward buying effects related to current geopolitical uncertainties and anticipated price increases, mainly in our packaging and consumer goods business. On business level, electronics and industrials continue to be the main growth drivers. Overall, mobility and electronics achieved 6.7% organic sales growth in Q1, driven by double-digit growth in electronics and very strong growth in industrials. Automotive demand was muted across different key markets, also reflected in the light vehicle production outlook for 2026, which is currently expected to decline by almost 2%. This compares to a flattish expectation at the beginning of the year. Packaging and consumer goods recorded positive growth of 0.5% in the first quarter. Consumer goods achieved good growth, also supported by forward buying effects. Packaging was below prior year, reflecting the persistent muted demand situation. Finally, sales in craftsmen, construction and professional came in below prior year. While manufacturing and maintenance showed positive growth, consumer and construction was negative due to the challenging market environment. Effective as of April 1st, we combined our strategic business unit construction and our strategic business unit consumers and craftsmen. From now on, we have two regionally focused units, consumer and construction Eurasia and Africa plus consumer and construction Americas. This enables us to accelerate growth and strengthen our market position while working more closely with local customers and partners. Turning to consumer brands, the business generated sales of 2.3 billion euros with an organic sales growth of 1.8%. Consumer sentiment remains muted. Nevertheless, we achieved good growth in sales. Both price and volume development were in positive territory with 1.1 and 0.7% respectively. With this, I would also like to highlight that volume development was positive for three consecutive quarters. Hair continued to be the main growth driver, delivering organic sales Laundry and home care showed a stable development. In home care, we saw positive organic sales growth, which was primarily driven by double-digit growth in hand dishwashing. Laundry care came in slightly negative, mainly due to fabric cleaning, while persil stood out with very strong growth. Fabric care showed significant growth, supported by our top brand, Pebble. Care achieved 5.1% organic sales growth, which was driven by both the consumer and the professional business. In the consumer business, the strongest contribution came from coloration. Here, our mega-brand Schwarzkopf showed significant growth, also supported by the recently launched innovations like, for example, Cream Supreme. The professional business recorded very strong growth, amongst others supported by strong growth in our key region, North America. Finally, other consumer businesses recorded positive organic sales growth of 0.5% driven by North America. Closing this chapter with our outlook for fiscal 2026. Our guidance ranges for organic sales growth, adjusted EBIT margin, and adjusted EPS growth at constant currencies remain unchanged. Of course, the crisis in the Middle East is a challenge for everyone. in particular the impact it has on direct material prices and logistics, which have increased notably since the beginning of the conflict. And we are working intensively on comprehensive countermeasures to mitigate the increased direct material price and logistics headwinds, for example, through supplier renegotiations, pricing actions, and intensified cost management. Taking this into consideration, as of today, the broad guidance ranges, which we choose to cater for the volatile environment, cover the current headwinds. With that, back to you, Carsten.

Thank you, Marco. So, let me wrap up today's presentation. We delivered good organic sales growth of 1.7% on group level, equally supported by both business units. We saw continued positive price and volume development in both business units, and as a result, volumes have been in positive territory for three consecutive quarters now. We are making strong progress in executing on our M&A strategy in both business units by adding highly attractive assets. We have already successfully closed three out of the five acquisitions, which in total will add annual sales of around 1.6 billion euros, and which are expected to deliver above average sales growth. We have successfully completed our 1 billion euros share buyback program by the end of March in line with the announced timeline. And last but not least, our full year 2026 guidance remains unchanged. With that, we would like to thank you for your attention and we are now happy to take your questions.

Thank you, Mr. Knobel. Ladies and gentlemen, the question and answer session will be conducted electronically. If you would like to ask a question, please press star and one on your telephone keypad. If you change your mind about asking a question, please press star and two on your touch-tone keypad. We will take question in order received, and we will take as many as time permits. Please limit your question to one question at a time to allow everyone to ask a question. Our first question comes from Guillaume Dalmas from UBS. Please go ahead.

Thank you and good morning Carsten, Marco and Lesley. One very quick housekeeping and then one question. The housekeeping is Marco, you mentioned some forward buying effects in adhesive technologies in the first quarter. I was just wondering if you could maybe quantify this impact on your Q1 organic sales growth. And then my question is on your margin guidance because you kept it unchanged despite now expecting high single-digit percentage inflation, your commodity cost. Can you maybe talk about the mitigating factors you've got in place and that you will implement to offset this additional cost? And I guess related to that, should we therefore expect a year of organic sales growth that could be more price-led as opposed to volume-led? Thank you very much.

Good morning, Guillaume. And I take your second question and I start with that and Marco takes the first one. So when your question is regarding margin guidance unchanged and the context of higher material prices, let me explain it in a way that One thing is clear, of course the crisis in the Middle East is a challenge for everyone and in particular the impact on the direct material prices where you have been referring to and also the logistic costs which have increased notable since the beginning of the conflict and which also led to the change from the low single digit originally now to the high single digit. And one thing is clear, we are working on that intensively on comprehensive countermeasures to mitigate the increase, the direct material prices and also the logistic headwinds, for example, with three areas. The one thing is supplier renegotiations. The second is pricing actions. And here, especially in Henkel Adhesive Technologies, we have taken learnings versus, you know, the COVID situation where we have been starting with this price increases earlier Then at that time, that's the second part. And the third one is an intensified cost management approach because we all don't know what is happening and how long these crises are with us. And taking this into consideration, as of today, you know, the broad guidance ranges which we had been giving at, you know, our full year call for 2025 and giving the outlook for 26, which were more broad, which we have chosen to cater for the volatile environment and cover also the current headwinds. For sure, at that time, we did not know that there would be a crisis or a war within the Middle East. And on the other side, Guillaume, if you look at the guidance, which is in terms of consensus, I think this is already in fact recalling that and showing that how that is related to that. So maybe that's on your question for the margin guidance. On top you had on the OSG the topic of pricing and volume for the full year. And yes, if you look at the quarter one, I think we have a good balance between price and volume. Even we had with a 0.7 price and 1.0 volume, even a higher volume start into the year. On the other side, you need what I just said in terms of the price situation in adhesive technologies that most probably over the course of the year will have a higher impact than what you have just seen in the quarter one. So we assume that for the full year we will see positive pricing and volume on group level. And please understand that we are not giving more details in terms of on the BU level part. Maybe that's a little bit broader the answer, but hope that covers your two questions. As with that, I'm giving or handing over to Marco to your first question with this topic of forward buying. Marco?

Good morning to you from my side. Yes, indeed we have seen some pre-buying or forward buying of customers that in particular developed in the course of March and that is closely related to what Carsten explained. We were relatively fast in also announcing certain price increases in parts of the business and that of course also resulted then in some pre-buying in particular the second half of March. So that came relatively late in the quarter and was also a bit surprising in the magnitude to us. We do estimate that that effect has roughly 80 basis points on our organic sales growth in the first quarter. And we see that, for example, in our packaging and consumer goods business, where I did also comment on that before. and more in Asia Pacific than in some of the other regions. So roughly 80 basis points effect on HAT in the first quarter. And what is also important when you look forward, of course, nobody knows how that can continue. We can probably not assume that that is going to continue now in second quarter in that magnitude. But what we also see is that in Q2, at least in adhesive technologies, we see some benefit coming from a from a positive working day impact in the second quarter. So also that has to be taken into consideration when we think now how would that all develop going forward. Very clear. Thank you very much.

You're welcome.

The next question comes from Nicola Serron from Bank of America Global Research. Please go ahead.

Good morning, all. Could you talk about your IMEA region? I think there's been a bit of a slowdown if you compare to Q4 last year. So maybe if you could talk about what country or what category drove the slowdown and if you've seen any strong impact on your Middle East business. Thank you.

Good morning, Nicolas, and thank you for the question. So first of all, I think slowdown, I would call it if you have a double-digit performance in a region of EMEA with this situation in which we are currently confronted with, means the crisis. I think that is a good result. And why is it a good result? Because we need to have a differentiated picture on that. because for sure we have some countries within EMEA which are impacted by the war and showing also not the same performance as we had in 2025, but there are countries like India and Turkey, which are part of the EMEA region, which are showing significant positive developments, and maybe to differentiate that a little bit, The performance is supported by both business units. And if we maybe start with adhesives, we delivered very strong growth in Q1, mainly driven by the mobility and the electronics division, as well as packaging and consumer goods, both of which showed double-digit growth rates. If we look at the consumer brands, here we recorded also double-digit growth in Q1, particular driven by a double-digit growth in both in laundry and home care and in hair. So therefore, in general, a quite good performance despite the situation which we are confronted with. And I think that brings it quite good across. Hope that helps, Nicolas.

Vielen Dank, Carsten.

Merci.

The next question comes from Fon Udonzilpa from RBC. Please go ahead.

Good morning. Thank you for taking my question. Just another one on pricing action, please. You touched on how you plan price negotiation for adhesive technologies, but could you also help us think about the consumer business? Are there any upcoming innovation that will be support price negotiation for the remainder of the year?

So, yes, I think it is clear that pricing, as I explained it, is for sure not only in quarter one, but especially also for the full year, is more driven by Henkel adhesive technologies. And as I mentioned it before, we have been already implementing certain price measures in that part, which is seen in Q1. but also will be seen during the next quarters. If we move to the consumer part of our business, the pricing was 1.1%, and by that remained in positive territory in the Q1, despite the muted consumer sentiment globally, and in particular, the intense competitive environment in laundry and home care. One, pricing was also supported by specific pricing initiatives related to strong launches and also relaunches and pricing measures in specific markets. And pricing in that context was positive in laundry and home care and also on other consumer business while slightly below the prior year. We constantly look at pricing opportunities, which you're referring to when you talk about innovations which are upcoming, in alignment with the market conditions and the reasonable implementation. And the commercial teams are closely monitoring all scopes for further potential price increases, also considering the recent dynamics from rising input costs. I hope that helps the answer on your question.

Very helpful. Thank you.

The next question comes from Christian Seitz from Kepler Chevreux. Please go ahead.

Yes, thanks and good morning, Carsten, Marco and Leslie and team. One question, please. How concerned are you about consumers down trading to private label brands due to inflationary trends left and right? I'm aware that you have a broad portfolio, including lower priced brands, yet there seems to be a trend of consumers seeing it as chic to shop for dedicated private label brands. Any comments would be welcome.

So, good morning, Christian, and thanks for your question. So, I think, first of all, the point of, you know, that consumers trading down, I think that's something whenever you, and I think I've talked about that, and you know that whenever we are coming into a crisis situation, or when our concerns about sentiment, I think that has an impact on consumer branded businesses. And as we always pointed out, more on laundry and home care than in the hair segment. and maybe a little bit more in detail after having shown some recovery in the GenFab of this year versus the muted levels at the end of 2025. Consumer sentiment has most recently weakened again in some key markets, so competitive pressure, And the muted sentiment continued to be most pronounced in the laundry market, as I mentioned, but that is not surprising or new. And, for example, in the U.S., consumer sentiment has dropped again recently and has even fallen below the 25 levels. And in Europe, consumer sentiment has stabilized at lower levels. And in Germany, towards the end of 25, but has recently weakened with the war of Middle East. You know, the answer of all of that is always innovation. You know, that is the purpose of a branded consumer goods company, to convince the consumer with innovations. And I made, I think, two references during our call today. The one is on our top 10 brands. not only that they are at the 60% level in terms of total sales but they are outperforming in terms of growth rates and again I think in both in price or with a good mix of price and volume and I think that is something which we have been you know had also some pain over the last years because we have been adjusting our portfolio more to the areas of stronger growing Categories and segments and also as I have been alluding to that In the meantime now the hair category if you would add the two acquisition or would you assume the closing of the two? acquisitions the hair Category in in our retailer in sorry in our retail business with would be as big as our laundry category and I think that is showing that our strategy is is absolutely working and we are executing that not only from an organic perspective but also from an investment philosophy now with, you know, recent years before with Vidal Sassoon and she stayed a professional and now with Not Your Mothers being already closed and Olaplex being signed and for sure we expect that this will be closed within this year and I think that is exactly in line of what we are what we are doing and I hope that gives you a little bit of Yeah, a glance of what is happening and how we are seeing the situation and That is for sure Yeah, as I said right strategy and executing against it Thanks very much.

Carson and yeah, good luck managing your overall portfolios with this unprecedented crisis. I

Yeah, but you know, Christian, we are used to that crisis situation, I would say, now since six and a half years. And we take it always as a challenge. And I think we have shown that we have a resilient team and also resilient businesses that are able to, I would say, compete and develop also in these really challenging times in which we are in. Thanks very much. Thanks for your thanks.

The next question comes from Tilly Eno from Morgan Stanley. Please go ahead.

Hi, good morning. Thanks for taking my questions. The first is just on, you've mentioned laundry, it's still quite challenging in terms of the competitive environment. Could you give us any more colour on the most recent developments there? Have you seen any let up in promo activity given the rising cost pressures that you're seeing? And then my second question just on hair. Just to clarify, I think you mentioned in one of the previous answers that pricing was down slightly year on year. Could I just check that that was correct? And could you give a little bit more color on the dynamics there if that was the case? Thanks very much.

I have not 100% your second question. I understood that was on hair, correct?

Yes, I think in one of the previous answers you mentioned that pricing was down slightly in hair care. If that was the case, just wanted to double check. And if so, could you just give a bit more color on what was driving that?

Good. So maybe first on clarifying that. My answer was only related on EMEA pricing, which was below prior year, not on the global setup of hair. Maybe that as a clarifying part before I come back now to your two questions How is laundry doing? How is hair doing? OK?

Perfect. Thank you.

Good. So maybe starting with laundry and home care, So laundry and home care showed slightly positive development in Q1, despite challenging market dynamics and an intense competitive environment. So laundry came in slightly below the prior year. Home care recorded really a positive growth set up. Within laundry, I think it's especially fabric finishes and fabric care who contributed very positively. And I mentioned in the call before that core breadth, no, in the call, in my presentation, that the core brands such as Pervol even showed very strong organic sales growth. And I think that is worth mentioning. Homecare recorded positive OSG in Q1 with the strongest contribution coming from dishwashing. And from that part, I think that's from my point of view on the laundry part. If I now move to the hair business, Hair continued its strong growth trajectory and even showed a further acceleration versus the Q4 of 2025, now reaching a very strong growth rate of above 5% in Q1, and that was driven by both, by consumer, professional, and I think, and the other one I think is important. Why is that? That is for sure not only why the market is attractive and showing good growth rates, but it's also related that we are, I would say, hitting the needs and the wishes of consumers. One example is our Cream Supreme from Schwarzkopf. I've mentioned that also during our AGM last week. I think it's a really fantastic product. innovation bringing also a new trend into the coloration business in a market which is for sure also very dynamic. So that's on that part. If I give you a little bit more now glance also when I split the hair business, the styling recorded a significant growth in Q1 of this year with strong regions and the strongest performance or support was from North America. In that context, colorants, besides what I just said related to Cream Supreme, was also with significant growth rates, especially strong in Europe and a double-digit growth in EMEA and in APAC. And the CARE part came in slightly below the prior year with significant growth in EMEA, offset by Europe. And our professional, I mentioned it before, more or less the same growth rate as also in the retail, very strong in Q1. And here all regions are really contributing very positively. And you may have seen now with the two acquisitions we are heading to means Not Your Mothers and also Olaplex. Both are very strong in CAIR. in the care segment which is the segment where we i would say in comparison to styling and colorants not as strong in care and i think here we would like to close the gaps from a regional perspective but also premium wise bringing solutions to that and therefore we have quite good positive thoughts when we take these two acquisitions into our portfolio hopefully the one already with Not Your Mother's the other hopefully quite soon. Hope that helps you, Tilly.

Thank you.

You're welcome.

The next question comes from David Hayes from Jefferies. Please go ahead.

Thank you, morning all. So my question is in focus on HCP. So just trying to understand whether there was any pre-buy dynamics in the first quarter. Some of your competitors have called out there was some bragging ahead of price increase risks. And I guess how that nets off with, I guess, what was, I think you talked about a sell-in ahead of sell-out in the fourth quarter due to innovation timing. So did that all sort of net off and there was no effect or whether it was some sort of net dynamic? And then related to that, just in terms of the second quarter, much more difficult comp, certainly at face value in the second quarter for HCP. So do you think that's still a positive growth level in the second quarter in terms of that comp stepping up? Thank you.

David, your two questions. So let me, I would say, Marco, you take first the pre-buying question.

So as we have commented, we see that very clearly in our adhesive technologies business that customers were on pre-buy. We could not observe that so clearly in our HCV business. But there are some reasons when we look at The development in the first quarter first, of course. We had quite soft comps in the year before, so that is one driver that has to be taken into consideration. And then secondly, we came out even a bit stronger than we expected in ACB because, in particular, our Middle East business has proven to be more resilient than initially thought. So these are basically the two key considerations for HCB in the first quarter. But again, pre-buying is mainly what we could see more clearly in our business.

David, on your second question, I fully understand your question, but I hope you also understand that In general, I would say we don't expect that consumer sentiment, or we do expect the consumer sentiment to remain subdued and the overall market environment to remain quite volatile. Also in Q2, you know, things are changing from day to day. On the other side, you know that we're not guiding and giving detailed information on quarters. You know, as I said, things are changing even from a week-to-week basis in that context. So, our guidance range for the business units, you know, expect that different developments are happening. So, yes, you're right that for sure the Q2 comparables are higher than the other ones. And I think that is also one of the reasons, you know, the 1.8% has been impacted also by lower comparables for Q1 of last year, you know, with the minus 3.5 we had at that point. And yes, we have tougher comps in Q2, but on the other side, I think that is the reason why we have also not changed or our guidance remains unchanged. Means for our consumer business, it is between 0.5 and 2.5. And therefore, we're for sure we're working as much as possible to further develop our business. As I mentioned it with the questions of Tilly before in the segment, I think we have good launches and innovations at hand, but the situation is not an easy one.

Hope that helps, David. That's great. Thank you.

The next question comes from Nikolai Olivieri from Goldman Sachs. Please go ahead.

Hi, morning, Carson, Marco, and Leslie. It's Olivier Nicolai from Goldman Sachs. Just one question on hair care. That was very strong in Q1. Can you give us a bit more details by region in terms of growth rates? And then you had some successful product launch in Q1. Can you give us a bit of an idea of how much of a boost it was, and is there any phasing impact we should be aware for the rest of the year? Thank you.

Good morning, Olivier. Sorry for that. I had a noise in the line. Can you repeat the second question, please?

So the whole question was on hair care. So we've been very strong in Q1. Can you give us a bit more color on the growth rate by region? And then how much of a boost in sales growth was driven by the new launches you have in Q1, and is there any phasing impact we should be aware for the rest of the year? Thank you.

Good. So thanks for the question. So maybe I didn't want to hear the second question, but to answer that on the first, please understand we don't quantify what is the impact of innovations or differentiate between what is the impact of running business and innovations in percentages. But let me first maybe, and that helps maybe a little bit, to give you more glance or input on how the hair business has been in Q1. So first, I said it, very strong growth for both consumer and professional. Performance in Q1 was above 5%, to be precise, 5.1%. If you look at the different segments, which is styling, colorants, and care. So styling recorded significant OSG, which came across the regions, but the strongest contribution was coming from North America. Hair colorants also a significant OSG in the Q1 with strongest growth or the strong growth in Europe and a double digit growth in EMEA and in APAC. And here I mentioned before the innovation of Cream Supreme, which has a quite significant innovative impact because that is a little bit to your second question where the innovations play quite a significant role. And hair care came in slightly below the prior year. Here we had quite good growth or significant growth in EMEA with being offset by Europe. And on the other side, what I can tell you for Cream Supreme that it delivered double-digit growth. Hair is positive across all the regions. If you now add, you know, care, styling, and color together, and I think that is, for me, a really significant positive sign that what we are doing, and you know, because David asked, think about comparables. We have always now, since the last couple of years, always high comparables in here, but we are always in the situation to outperform that. So we are really having a good run in that business based on organic developments, but also about the acquisitions we have done in the past. Vidal Sassoon, she's a professional, also from a technological point, again, to your innovation questions. We have taken also innovations or technology which we acquired via the Shiseido Professional into the rest of our portfolio. And in that context, really looking forward to a business which is very strong. And I mentioned it in the meantime, also as big as our laundry from a global perspective. Hope that helps. Thank you. Thank you, Olivier.

The last question comes from Michael Omadadze from BNP Paribas. Please go ahead.

Morning, Carsten, Marco, and Leslie. One follow-up and two quick questions from me, please. So on the follow-up, on the thesis you referred that there will be likely moderation of pre-buying benefit in Q2, but also that there will be a working day benefit and more pricing. Net-net, do you expect organic sales growth to step up in a thesis in Q2 versus Q1? And should we expect any working day impacts in Q3 versus Q2? And my two questions, one would be on the raw mats. So the guidance that you provided, could you please shed some color whether you assume a step up in raw materials to be more material in adhesives versus consumer brands or vice versa? And the last one would be on your EPS guide. What do you currently factor in in terms of the tailwind from your acquisitions?

Thank you. Michael, so thank you for your three questions or follow-up and questions. The follow-up topic regarding pre buying and also the second in terms of Roth Marco will take these from an EPS perspective I think it is it is quite clear as I said the guidance or as we said the guidance is unchanged you have heard us saying that in total the acquisitions we will realize synergies in a high single digit of sales related to the acquisitions we are doing and we have also gained in terms of full swing when we have integrated all the acquisitions until 2030 there will be an impact of at least 10% impact, you know, the impact within this year. We would like then to quantify if we have also closed all the acquisitions and, you know, there is, yeah, I will not speculate when will that happen, but most probably we can do that in the half-year call when we are in August. And with that, handing over to Marco for your follow-up question and for your follow-up and the question. Marco?

So indeed, you had a question on HAT, so adhesive technologies, impacts from pre-buying, working day effect, and pricing. Pre-buying, I did quantify that we'd expect that with roughly 80 base points impact in the first quarter. And then we also commented that we see a positive working day effect in the second quarter. And here order of magnitude is 100, 250 basis points impact that that can have positive in the second quarter and then some positive pricing. But all that is, I would say, yet difficult to predict what the net is out of that. So I would refrain now from saying whether how that compares second quarter to first quarter. That's too early to say, in particular in that volatile environment. And in regards to the working day effect for the second half or Q3, Q4, we see that there is no major working day effect that we do expect in the second half of the year that I can say. Then on the raw material guidance question that you had is how understood it? Is it more impacting adhesive technologies or consumer brands? We see that, in fact, more skewed towards adhesive technologies, so headwinds roughly more hitting adhesives with two-thirds and HCB with one-third of the impact.

Very clear. Thank you very much.

Michael, thank you.

Thank you, ladies and gentlemen. I would now like to hand over to Mr. Knobel for his closing remarks.

So first of all, thank you so much for your questions. And with that, let me close today's call with reminding you of the upcoming financial reporting dates. We are looking forward to connecting with you again, I mentioned before, in August, when we will publish our half-year report. And with this, I would like to thank you for joining our call today. Marco and myself wish you a good day. Take care and also goodbye. See you soon.