Dr. Wolff Group breaks into the top flight and begins a world tour
In 2014 sales increased by 18% / Impetus mainly due to Alpecin und Plantur / Successes in cosmetics and pharmaceuticals / All six brands are experiencing double-digit growth, some of them abroad even more
Thanks to Dr. Wolff, the Giant-Alpecin team means that Germany will be represented by a professional cycling squad in the UCI World Tour after a hiatus of several years. Accordingly, Germany will at last return as a major force in international cycling. For the Dr. Wolff Group, this opens up unique opportunities to further develop new global markets, because the family-owned business is not only stepping up the pace in cycling, but is also moving up several gears in business.
For example, we succeeded in closing the 2014 financial year – despite certain difficult market conditions – with a double-digit plus, which well exceeded the average for the industry. Sales for the Dr. Wolff Group increased by € 36 million to € 243 million in 2014. "This is the highest growth in the history of the company, now for the tenth time in a row. Our major international efforts over the last few years are now making themselves felt for the first time", said managing partner Eduard R. Dörrenberg at the financial statement press conference in Düsseldorf. He also offered his thanks to all employees for their great commitment.
This explosive burst of energy in 2014 has also made itself felt in the staffing situation: The Dr. Wolff Group currently has approx. 530 employees. In January 2015 alone, the group welcomed 19 new colleagues. And there are plans to hire more people.
Growth was ten times higher than in the industry
The total sales revenue of € 243 million in 2014 corresponds to growth of 18% compared to the prior year (2013: € 207 million). By comparison, the industry expanded by just 1.6%, after 0.6% the year before. Both the Cosmetics division (Dr. Kurt Wolff GmbH & Co. KG) and the Medical division (Dr. August Wolff GmbH & Co. KG) of the Dr. Wolff Group played their part in this. The strong upward trend was mainly due to international business, which rose for the group by 47% to almost € 46 million in total (2013: € 31 million). "For example, our activities in Singapore, Hong Kong, England, Finland and, most recently, Taiwan, South Africa and Hungary were very successful", explained Dörrenberg. Even though the positive domestic trend 12% to € 198 million (2013: € 176 million) showed considerable momentum, the group's export share increased from 15% to 19% as a result of the particularly high growth abroad.
Many stage wins contributed to overall success
In the past year, the Group again succeeded in gaining several stage victories. While the Cosmetics division experienced quite dramatic growth of 21%, generating sales of € 171 million (2013: € 141 million), the Medical division also significantly expanded by 10%, reaching a total sales volume of € 72 million (2013: € 66 million). "The fact that we have developed on a broad front and are not dependent on individual successes lends this result even greater significance“, said the managing partner, explaining the figures.
In terms of the individual brands, Alpecin was the strongest of the company and has resumed its leading role for the group. There is clearly a strong desire among men to have healthy, full hair, and not just in Germany. There is no other way to explain the increase in Alpecin exports by fully 44%. International sales actually doubled for Plantur, the caffeine shampoo brand for women. The Linola brand confirmed its usual strong positioning with many products. The gynaecological preparations of the Vagisan brand significantly developed its potential, internationally as well. The development of Biorepair was also pleasing, more than simply maintaining the breakthrough of previous years.
2015: Planning for greater market presence abroad
The Dr. Wolff Group has made a very promising start to 2015, and so again its aims for the rest of the year are ambitious. "We are carrying on from where we left off last year, and will again adopt new approaches in many areas", said Dörrenberg, without giving away any details. At all events, the pipeline of new products, whether cosmetics, medical devices or pharmaceuticals, is well-filled. Innovative products are to be expected in 2015, including in Germany. "Our internationalisation strategy and our involvement in cycling will ensure even stronger market presence abroad", said Dörrenberg, announcing that mainly international business will be the driving force. The involvement of around 250 international journalists from many countries including South Africa, Taiwan, Hong Kong, the UK and the Netherlands at the team presentation in Berlin already bore testament to its global significance.
The Dr. Wolff Group wants to better prepare for the future with targeted investment activities at the group's headquarters in Bielefeld. Expenditure for the next two years is planned to be double-digit millions which will go towards production and logistics. Central administration capacity is also to be expanded.
The Cosmetics division:
Strongest growth in the history of the company
In the 2014 financial year, Dr. Kurt Wolff GmbH & Co. KG, representing the Cosmetics division of the Group, generated sales of € 171 million (2013: € 141 million), which corresponds to growth of 21% and is therefore the highest rate of growth the company has seen in its 110-year history. Sales abroad also developed particularly well.
Alpecin: Enormous popularity continues
The success of this division was once again driven by the Alpecin brand, with the extremely popular caffeine shampoo as the main product. With sales growth of 22% to € 69 million (2013: € 57 million) Alpecin consolidated its position as the strongest brand in the entire group. The brand gained a further 16% on a national level, while the total hair care market in Germany grew by only 0.8%. According to Nielsen the 250 ml packs of Alpecin caffeine shampoo are currently the biggest seller in the German drugstore market.
The intensified international market activities were particularly notable. In 2014 they were supported by TV advertisements and particularly focused on Hong Kong, Taiwan, South Africa, the Czech Republic and Hungary in addition to the UK, Austria, Switzerland and the Netherlands. Consequently, international sales increased by 44%. In Hong Kong, Alpecin very quickly became the number one remedy for hair loss. In Taiwan, demand became so great that extra deliveries had to be flown over.
"German quality and the increasing number of scientific findings prove how effective caffeine is," explained Dörrenberg. At the press conference, he identified this a one of the main reasons for the continuing upward trend for Alpecin which also applies similarly for the preparations of the Plantur range. A new study recently published in the British Journal of Dermatology confirms that caffeine promotes hair growth. The study also shed more light on the previously unknown mode of action.
Plantur: Triumphant rise continues abroad
In its tenth year of existence, the Plantur brand continued its success and proved itself as a pacesetter for the whole division, with a sales increase of 28%. Sales for the reporting year totalled € 41 million (2013: € 32 million). Sales outside of Germany doubled, which, for Dörrenberg, is clear proof that the strategic plans for this brand were and are right: "The international launch was as successful as the earlier launch in Germany. Our strategy to break the taboo by explicitly discussing the subject of hair loss among women is working everywhere where we are active.“
The managing partner is convinced that the positive development of the Alpecin and Plantur brands will continue. He believes that, at the moment, German quality is currently a guarantee for effectiveness and efficiency in all markets. And the commitment to organized cycling will underpin the significance of both brands on a global level, particularly since the Liv-Plantur women's team has also taken part in cycle races in many countries, from Asia to America.
Biorepair: An innovative approach has proven itself
Revenue growth in 2014 of 16% to 19 million euros (2013: 16 million euros) confirmed the breakthrough of the Biorepair brand of the previous years. The innovative nature of the Biorepair Oral Care program has proven itself. More and more scientists are working on the subject of healthy dental enamel. Biorepair successfully adheres to the surface of the tooth while brushing thanks to zinc-carbonate hydroxyapatite, which simulates natural enamel, and therefore forms a protective layer on the tooth. In many cases, products for enamel care are considered a category of their own on the market, and Biorepair is the most successful brand in the top-price segment. In terms of future prospects, additional impulses are expected as a result of demographic trends. According to Dörrenberg: "With an aging population, the subject of tooth erosion as well as possible solutions is expected to gain importance." At Dr. Wolff, more intensive research is being done on this. Other new developments will be ready for the market in 2015.
Alcina: Major investments in the brand are paying off
The Alcina brand concluded 2014 with sales of € 42 million (2013: € 36 million) – an increase of 17% shared evenly between national and international business, and also across hair dye, hair care and decorative cosmetics. Major investments in the brand created the conditions for sustainable position improvement on the market in 2014. The priority was the development of a new line of decorative cosmetics with the aim of further strengthening the competitiveness of hairdressers. Thanks to Alcina, they now have more essential expertise in dyeing techniques than ever before - in respect of both decorative cosmetics and hair. With international hair stylist Paul Gehring and Manh Dung Nguyen, the new star make-up artist, Alcina now has the support of two top experts as brand ambassadors. On this basis, Alcina will also focus on colours in 2015. For training, the Dr. Wolff Institute and its own seminar service are available with comprehensive programmes. "Our hairdressing partners can rely on the fact that our commitment to training and continuing education will continue to be of significance even under the different conditions“, announced Dörrenberg.
The Medical division:
Own efforts have resulted in a significant increase in sales at home and abroad
Dr. August Wolff Arzneimittel GmbH und Co. KG, the manufacturer of pharmaceutical products in the Dr. Wolff Group, 2014 also saw a significant increase in sales in Germany and abroad, despite poor weather conditions (no winter = heat record in Germany). Sales grew by 10% to € 72 million (2013: € 66 million). "Considering the market conditions which are mainly characterised by acquisitions and takeovers, this is an extremely positive result, as this growth is the result of our own efforts", Eduard R. Dörrenberg explained its special significance. The motor for growth in pharmaceuticals was also international sales, which increased by an impressive 38%. Business in Germany also grew by a further 6%.
Linola: Increasing number of users worldwide
In 2014 the traditional Linola brand confidently maintained its position. With an increase of 9%, Dermatology achieved sales of € 47 million (2013: € 43 million). The demand for Linola products is being increasingly influenced by the weather and, accordingly, climate change which can now no longer be ignored, as the company Dr. Wolff is well aware. Besides the classic products such as Linola Fett and Linola Lotion, it was mainly the innovation of the breathable Linola Protective Balm that ensured further independence in medical skin care in 2014. Linola is attracting more and more users in the areas of child care, senior care and sport around the world – this can been seen in the international sales, which increased by 37% in the last year. The company is also expecting this positive trend to continue in 2015. "Linola's long-standing history has of course established it excellently on the market and the brand has also taken a leading position in certain segments, but this does not mean that we will settle for the status quo," Dörrenberg hinted, emphasising that Linola is still an ambitious brand. For ten years now, the advertising figure Lino has been boosting the popularity of the traditional brand. Because Lino is well received in Germany, now is the time for him to gain more popularity abroad.
Vagisan: Breaking the taboo is catching on
Even at the international level women have accepted breaking the taboo and have actively tackled the frequent problem of vaginal dryness using products from the gynaecological line of products by Dr. August Wolff. This resulted in particularly good international sales of Vagisan products in 2014. The increase in sales for Vagisan was 44%, while sales for the whole division rose by 11% to € 23 million (2013: € 21 million). Vagisan products are now sold in 16 countries, the most recent new markets being Iraq and Portugal. Even conservative markets in the Arab world are showing great potential, however certain lengthy and increasingly complex registration requirements have slowed potential growth, even if only temporarily. According to Dörrenberg, development has in no way come to an end. "In 2015 we will be focusing on further international expansion for the gynaecological products", he stated in Düsseldorf and discussed initial activities in Poland that are now imminent.
Research: Positive developments
Scientific research and the search for innovations are the key to success at Dr. Wolff. Even though the time and effort to make a product market-mature are increasing, innovations are and will continue to drive future growth, including internationally.
The out-licensing of a new oral anti-inflammatory active ingredient, which has been successfully tested against Colitis ulcerosa (inflammatory bowel disease), will be completed early in the new year. An antiseptic with the active substance Octenidin in liquid or semi-solid pharmaceutical form has been authorised in Germany, the Baltic states, the Czech Republic and Hungary. Authorisation for Austria and Poland is expected in the first six months of the year. Tests of kappa opioid receptor antagonists for local application for patients with atopic eczema will be completed in the second quarter. Pharmacological and toxicological studies of a third active ingredient with anti-inflammatory, anti-proliferative effect have been positive up to now, so that plans for the first clinical trial can be started this year. Scientific discussions about developing a further pharmaceutical have also been successful. The start of a clinical proof-of-concept study is planned for the fourth quarter. The clinical trial of a new medical device for the prophylaxis and treatment of bacterial vaginosis for tolerability and efficacy had to be delayed due to problems with recruiting patients. The first results are now expected at the end of June. A cosmetic with a new type of plant extract provided impressive results for the medical skin care of atopic eczema, so market launch is planned for the third quarter.
The comprehensive investments of the last few years have been very fruitful so that the issuance of a new pharmaceutical authorisation can be expected for the start of the third quarter. The pipeline of new products, whether cosmetics, medical devices or pharmaceuticals, is full.