Henkel's Incoming CEO Has 'Big Shoes to Fill,' Investors Say
Henkel AG investors, bidding farewell to outgoing Chief Executive Officer Kasper Rorsted at his last annual meeting, laid a list of demands at the feet of successor Hans Van Bylen that include a higher share price and dividend payments.
Shareholders want the stock to rise to and stay above €100 ($114) each, a price last seen on a closing basis on 30 December, Jella Benner-Heinacher, deputy head of Germany’s largest association for private investors, DSW, said on Monday at the meeting in Dusseldorf, where Henkel is based. The shareholder also wants a dividend of €1.60 a preferred share this year, compared with the €1.45 paid by the maker of Loctite glue and Schwarzkopf shampoo in 2015.
Rorsted will be a hard act to follow, according to almost all of the speakers at Monday’s meeting, who praised the departing CEO. Rorsted is leaving to take the helm of sportswear and equipment company Adidas AG at the end of this month after more than tripling Henkel’s share price during his eight-year reign and boosting net income by 57 per cent. Van Bylen takes over on 1 May.
"The shoes, that you have presented to your successor to fill, are enormously big," said Hans-Martin Buhlmann, chairman of the Association of Institutional Shareholders. "I hope, Mr. Van Bylen, that they fit."
Henkel preferred shares gained 0.3 per cent to €98.77 as of 4:26 pm in Frankfurt. The stock has lost 4.3 per cent this year, cutting the market value to €40.4 billion.
Before his departure, Rorsted retreated from a 2016 revenue goal of €20 million. Henkel is facing currency headwinds, particularly in emerging markets, the CEO said in a statement on Monday.
Rorsted impressed investors by taking responsibility for the missed sales goal rather than leaving his successor to take the blame, Benner-Heinacher said.
"From a shareholder point of view all is well on the Henkel ship," she said. "While the captain is stepping down, today with a beard, he is leaving orderly conditions. Time to say goodbye."
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