Summary: Beiersdorf told investors and media that fighting in the Middle East is disrupting shipments and sales into important Gulf markets, and that the company has trimmed its full-year outlook amid a slower recovery at its Nivea brand and a challenging operating environment.
Nivea-maker Beiersdorf said the conflict in the Middle East has caused interruptions to both sales and deliveries in its key Gulf markets. Chief Executive Vincent Warnery said the company had been unable to deliver some products to Saudi Arabia and the United Arab Emirates because of the conflict, a development that has weighed on local consumption and raised costs for the business.
"That’s something which is impacting not only our cost, but also our consumption. So we hope that the war will finish soon in order to get back to normal business," Warnery said during a media call, describing the operations disruption in the region.
The comments follow an earlier warning from Beiersdorf in April that parts of the Middle East had already seen sales sharply affected by the conflict. Management said it continues to watch developments closely as the situation unfolds.
Warnery also said the company has been monitoring oil markets for any knock-on effect on input costs, particularly packaging. While oil prices rose sharply following the escalation of fighting between the United States and Iran, Warnery said prices had not reached the levels Beiersdorf had feared. "That’s the good news," he added, while qualifying that sustained increases in oil prices would eventually flow through to costs because the company uses large amounts of plastic packaging.
Against this backdrop, Beiersdorf on Monday trimmed its full-year outlook, citing a difficult market environment and a slower-than-expected recovery at its core Nivea brand. Management linked the revision to the combined effects of geopolitical disruption in the Middle East and a softer-than-anticipated brand rebound.
The company highlighted two immediate operational channels for the impact: interrupted deliveries that reduce local availability and consumption, and the prospect of higher packaging costs if oil prices remain elevated. Both elements have been cited by management as contributing factors to the revised guidance.
Context limitations: The company described regional delivery interruptions and monitoring of oil markets but did not provide detailed figures for the volume of disrupted shipments or precise cost impacts in the comments summarized here.