Beiersdorf’s Shares

Markets around the world were focused mainly on the international financial crisis during 2008. Players’ activities were dominated by collapses and rescue plans on a hitherto unprecedented scale, while extreme commodity price swings – especially for oil – led to highly volatile performances by almost all stocks on the equities markets. At the beginning of the year, investor appetite was hit by increases in the price of oil in particular. Brent crude broke through the USD 100 per barrel barrier for the first time at the end of February. The euro’s initial appreciation against the dollar temporarily curbed the effect on the German economy, although it did have a clearly negative effect on exports. Emerging markets were the main driving force behind global growth in the second quarter. At the same time, commodity prices continued to rocket, peaking in the middle of the year (Brent crude cost USD 145 per barrel for a time). Rising long-term interest rates also put pressure on the stock markets and led to a fall in the indices. This slump continued in the second half of the year with indices losing more than 10% per day in some cases during the height of the banking crisis in September and October. Bank stocks led to unusual price movements on the DAX, pushing the key German index down close to the 4,000-point mark. Then, in the fourth quarter, the rescue packages by the world’s central banks led to the situation quietening down a little. In this environment, the DAX closed the year at 4,810 points.

The consumer goods manufacturers in the European HPC (Household and Personal Care) Index reported strong results in the first and second quarters. However, investors remained cautious due to the uncertain economic outlook. As a result, the Index initially mirrored and then, in the third quarter, underperformed the DAX and other key indices. However, the sector recovered some ground during the turbulence in September and October – the crisis months – and closed the year on a positive note. 

Beiersdorf’s share price remained uncoupled from the German indices for relatively long periods in 2008. In the first quarter this was due to the defensive character of our shares and related positive expectations by investors given the uncertain times. In the third quarter, the announcements regarding the Company‘s business performance and its integration of the Chinese hair care business of C-BONS Hair Care triggered independent price movements by Beiersdorf’s shares in the third quarter. The planned investments in the Chinese hair care market were the subject of intense market discussion in the course of the third quarter, and it took some time for them to be recognized as a key element in the development of Beiersdorf’s Chinese business. However, investor confidence rose sharply in conjunction with the excellent growth figures for the first nine months, with shares significantly outperforming the markets in the fourth quarter. At the beginning of December, Deutsche Börse (German Stock Exchange) resolved to admit our shares to the DAX, Germany’s bellwether stock market index; on December 22, Beiersdorf officially became one of the 30 leading listed companies in Germany. At the end of the year, Beiersdorf’s shares remained firm and clearly outperformed the indices to close at €42.00.

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