Q3 Quarterly financial report July through September 2016

Financial report January through September 2016

Henkel: Financial highlights

in million euros1	Q3/2015	Q3/2016	+/–	1–9/2015	1–9/2016	+/–
Sales	4,590	4,748	3.4%	13,715	13,858	1.0%
Laundry & Home Care	1,314	1,479	12.6%	3,926	4,157	5.9%
Beauty Care	964	968	0.4%	2,910	2,906	–0.1%
Adhesive Technologies	2,279	2,272	–0.3%	6,783	6,705	–1.1%
Operating profit (EBIT)	666	775	16.4%	2,029	2,249	10.8%
Adjusted2 operating profit (EBIT)	778	837	7.6%	2,253	2,407	6.9%
Return on sales (EBIT) in percent	14.5	16.3	1.8pp	14.8	16.2	1.4pp
Adjusted2 return on sales (EBIT) in percent	16.9	17.6	0.7pp	16.4	17.4	1.0pp
Net income	494	584	18.2%	1,507	1,694	12.4%
Attributable to non-controlling interests	10	8	–20.0%	32	32	0.0%
Attributable to shareholders of Henkel AG & Co. KGaA	484	576	19.0%	1,475	1,662	12.7%
Earnings per preferred share in euros	1.12	1.33	18.8%	3.41	3.84	12.6%
Adjusted2 earnings per preferred share in euros	1.30	1.42	9.2%	3.77	4.09	8.5%
Return on capital employed (ROCE) in percent	18.7	19.3	0.6pp	18.8	19.8	1.0pp

pp = percentage points

1 Calculated on the basis of units of 1,000 euros; figures commercially rounded.

2 Adjusted for one-time charges / gains and restructuring charges.

3 Highlights third quarter 2016
4 Major events
4 Share performance
6 Report third quarter 2016
16 Financial report January through September 2016
23 Subsequent events
24 Outlook
26 Interim consolidated financial statements
32 Selected explanatory notes
40 Independent review report
41 Report of the Audit Committee of the Supervisory Board
42 Multi-year summary
43 Contacts / Credits
43 Financial calendar

Highlights third quarter 2016

Key financials

4,748million euros

sales

775million euros

operating profit (EBIT)

1.33euros

earnings per preferred share (EPS)

576million euros

net income attributable to shareholders of Henkel AG & Co. KGaA

5.2%

net working capital in percent of sales

+2.8%

organic sales growth +4.0% Laundry & Home Care +2.6% Beauty Care +2.5% Adhesive Technologies

837million euros/+7.6%

adjusted1 operating profit (EBIT) / year-on-year increase

1.42euros/+9.2 %

adjusted1 earnings per preferred share (EPS) / year-on-year increase

17.6 %

adjusted1 return on sales (EBIT): up 0.7 percentage points 17.9% Laundry & Home Care 17.5% Beauty Care 18.9% Adhesive Technologies

Key facts

Strong organic sales growth in emerging markets.

Very strong increase in adjusted operating profit.

Adjusted earnings per preferred share with high single-digit growth.

Acquisition of The Sun Products Corporation in the USA completed.

1 Adjusted for one-time charges (27 million euros) and restructuring charges (35 million euros).

Major events

You will find our annual reports, our quarterly financial reports, the latest data on Henkel's shares and bonds, and also news, reports and presentations relating to the company, on our Investor Relations website:

www.henkel.com/ir

The acquisition of the laundry and home care company The Sun Products Corporation, which was agreed in June 2016, was completed on September 1, 2016. The value of the transaction, including debt, was around 3.2 billion euros. With this, Henkel has now become the second largest company in the US laundry care market.

On September 7, 2016, Henkel successfully placed bonds with a value of 2.2 billion euros. Their purpose is to refinance the short-term bank loan used to fund the acquisition of The Sun Products Corporation. A total of four fixed-rate tranches in three different currencies were placed.

In renewed recognition of our sustainability performance, Henkel was listed on several sustainability indices in France, Italy, the UK and the US, including the most recent Dow Jones Sustainability Index (DJSI World). In addition, Henkel is represented in the FTSE4Good ethics index for the 15th consecutive year, and listed in the Ethibel Sustainability Indices, Euronext Vigeo Eiris Indices and Global Equity ECPI Indices.

Share performance

The share indices relevant to Henkel posted positive performance in the third quarter of 2016. The DAX closed at 10,511 points, an increase of 8.6 percent. The EURO STOXX® Consumer Goods Index also performed well, gaining 6.0 percent.

The price of Henkel preferred shares increased significantly, by 10.5 percent in the third quarter of 2016, from 109.55 euros to 121.00 euros. The price of our ordinary shares also increased, ending the period up 6.9 percent at 103.60 euros. Both shares were quoted at their highest ever prices in the third quarter: preferred shares at 122.85 euros and ordinary shares at 104.40 euros. The preferred shares traded at an average premium of 16.0 percent over the ordinary shares in the third quarter.

Key data on Henkel shares, third quarter

Q3/2016	Q3/2015	in euros
		Earnings per share
1.32	1.11	Ordinary share
1.33	1.12	Preferred share
		Share price at period end1
103.60	78.94	Ordinary share
121.00	91.97	Preferred share
		High for the period1
104.40	95.24	Ordinary share
122.85	112.15	Preferred share
		Low for the period1
93.85	76.32	Ordinary share
107.75	87.75	Preferred share
48.5	36.9	Market capitalization1 in bn euros
26.9	20.5	Ordinary shares in bn euros
21.6	16.4	Preferred shares in bn euros

Performance of Henkel shares versus market third quarter 2016

Performance of Henkel shares versus market January through September 2016

Henkel ordinary share (indexed)

EURO STOXX® Consumer Goods Index (indexed)

DAX (indexed)

Report third quarter 2016

Business performance third quarter 2016

Key financials 1

in million euros	Q3/2015	Q3/2016	+/–
Sales	4,590	4,748	3.4%
Operating profit (EBIT)	666	775	16.4%
Adjusted2 operating profit (EBIT)	778	837	7.6%
Return on sales (EBIT)	14.5%	16.3%	1.8pp
Adjusted2 return on sales (EBIT)	16.9%	17.6%	0.7 pp
Net income – attributable to shareholders of Henkel AG & Co. KGaA	484	576	19.0%
Adjusted2 net income – attributable to shareholders of Henkel AG & Co. KGaA	564	616	9.2%
Earnings per preferred share in euros	1.12	1.33	18.8%
Adjusted2 earnings per preferred share in euros	1.30	1.42	9.2%

pp = percentage points

1 Calculated on the basis of units of 1,000 euros; figures commercially rounded.

2 Adjusted for one-time charges/gains and restructuring charges.

Results of operations

We increased sales by 3.4 percent to 4,748 million euros in the third quarter of 2016. Adjusted for negative foreign exchange effects of 3.3 percent, sales improved by 6.7 percent. Organically (i.e. adjusted for foreign exchange and acquisitions/divestments), sales increased by 2.8 percent. We improved adjusted return on sales (EBIT) by 0.7 percentage points to 17.6 percent. Compared to the prior-year quarter, adjusted earnings per preferred share rose by 9.2 percent.

Sales development1

in percent	Q3/2016
Change versus previous year	3.4
Foreign exchange	–3.3
Adjusted for foreign exchange	6.7
Acquisitions/divestments	3.9
Organic	2.8
of which price	0.2
of which volume	2.6

1 Calculated on the basis of units of 1,000 euros.

The Laundry & Home Care business unit recorded solid organic sales growth of 4.0 percent, primarily based on volume increases. The solid organic sales growth of 2.6 percent in the Beauty Care business unit was also largely driven by volume. The Adhesive Technologies business unit posted solid organic

sales growth of 2.5 percent, which was also attributable to volume increases.

Price and volume effects third quarter 2016

in percent	Organic sales growth	of which price	of which volume
Laundry & Home Care	4.0	0.4	3.6
Beauty Care	2.6	0.8	1.8
Adhesive Technologies	2.5	–0.1	2.6
Henkel Group	2.8	0.2	2.6

The scope of our business activities and competitive positions as described in our Annual Report 2015 on page 57 did not change materially in the third quarter of 2016.

In order to adapt our structures to our markets and customers, we spent 35 million euros on restructuring (prior-year quarter: 78 million euros). To build a scalable business model, we are expanding our shared services and progressing with the combination of our supply chain and sourcing activities into one integrated global supply chain organization. We also continued to integrate our acquisitions.

In the following, we discuss our operating income and expense items up to operating profit, adjusted in each case for one-time charges/gains and restructuring charges. The reconciliation statement and the allocation of the restructuring charges between the

Q3/2015	%	Q3/2016	%	+/–
4,590	100.0	4,748	100.0	3.4%
–2,351	–51.2	–2,433	–51.2	3.5%
2,239	48.8	2,315	48.8	3.4%
–1,136	–24.8	–1,149	–24.2	1.1%
–114	–2.5	–116	–2.4	1.8%
–212	–4.6	–212	–4.5	0.0%
1	0.0	–1	–0.1	–
778	16.9	837	17.6	7.6%

Reconciliation from sales to adjusted operating profit1

1 Calculated on the basis of units of 1,000 euros; figures commercially rounded.

various expense items of the consolidated statement of income can be found on page 28.

Compared to the third quarter of 2015, cost of sales increased by 3.5 percent to 2,433 million euros. Gross profit rose by 3.4 percent to 2,315 million euros. Gross margin remained stable compared to the third quarter of 2015, at 48.8 percent. Savings from cost reduction measures and efficiency improvements, selective price increases and slightly lower prices for direct materials offset the impact of negative foreign exchange rate movements and acquisition effects.

Marketing, selling and distribution expenses increased slightly year on year to 1,149 million euros. Their ratio to sales declined by 0.6 percentage points to 24.2 percent. We spent a total of 116 million euros on research and development. The ratio to sales, at 2.4 percent, was slightly lower year on year. Administrative expenses remained unchanged year on year, at 212 million euros. The ratio to sales of 4.5 percent was slightly below the level of the third quarter of 2015.

At –1 million euros, the balance of operating income and charges was unchanged year on year.

Adjusted operating profit (EBIT) increased by 7.6 percent from 778 million euros to 837 million euros. We were able to further improve adjusted return on sales for the Group from 16.9 percent to 17.6 percent. The margin in the Laundry & Home Care business unit – at 17.9 percent – was 0.3 percentage points lower year on year, due to acquisitions. Excluding the acquisitions made in 2016, adjusted return on sales showed a strong increase. In the Beauty Care business unit, we achieved an excellent margin improvement from 16.1 percent to 17.5 percent. The Adhesive Technologies business unit was able to grow its return on sales very strongly with an increase of 0.8 percentage points to 18.9 percent. The margin developments in all three business units were attributable in part to solid organic sales performance combined with strict cost management.

Due to acquisitions, the financial result was lower year on year, at –15 million euros. The tax rate was 23.2 percent (adjusted: 24.1 percent).

Net income for the quarter increased by 18.2 percent from 494 million euros to 584 million euros. After deducting 8 million euros attributable to non-controlling interests, net income for the quarter was 576 million euros (third quarter 2015: 484 million euros). Adjusted net income for the quarter after deducting non-controlling interests was 616 million euros compared to 564 million euros in the prioryear quarter. Earnings per preferred share (EPS) rose from 1.12 euros to 1.33 euros. After adjustment, EPS increased from 1.30 euros in the third quarter of 2015 to 1.42 euros in the third quarter of 2016.

Regional performance

Key figures by region 1 third quarter 2016

in million euros	Western Europe	Eastern Europe	Africa/ Middle East	North America	Latin America	Asia Pacific	Corporate2	Henkel Group
Sales July–September 2016	1,473	733	348	1,067	268	830	29	4,748
Sales July–September 2015	1,508	733	320	940	280	777	33	4,590
Change from previous year	–2.4%	0.1%	9.0%	13.5%	–4.4%	6.9%	–	3.4%
Adjusted for foreign exchange	–0.5%	5.2%	16.4%	14.0%	14.8%	7.3%	–	6.7%
Organic	–0.5%	4.5%	6.9%	1.6%	13.9%	4.3%	–	2.8%
Proportion of Henkel sales July –September 2016	31%	15 %	7%	22%	6%	18%	1%	100%
Proportion of Henkel sales July –September 2015	33%	16%	7%	20%	6%	17%	1%	100%
Operating profit (EBIT) July – September 2016	342	99	27	174	32	133	–31	775
Operating profit (EBIT) July – September 2015	289	109	22	161	35	105	–54	666
Change from previous year	18.3%	–9.3%	25.5%	7.8%	–8.8%	26.9%	–	16.4%
Adjusted for foreign exchange	19.4%	–3.6%	39.8%	8.3%	36.2%	27.4%	–	20.3%
Return on sales (EBIT) July – September 2016	23.2%	13.5%	7.8%	16.3%	11.8%	16.0%	–	16.3%
Return on sales (EBIT) July – September 2015	19.2%	14.8%	6.8%	17.2%	12.4%	13.5%	–	14.5%

1 Calculated on the basis of units of 1,000 euros; figures commercially rounded.

2 Corporate = sales and services not assignable to the individual regions and business units.

In the following, we comment on our results in the third quarter 2016:

In highly competitive markets, organic sales in the Western Europe region were 0.5 percent lower compared to the prior-year quarter. Performance varied across the region. While organic sales in Germany showed a degree of positive development and there was solid growth in Spain, sales in France and Italy were lower versus the prior-year quarter.

Operating profit in the region increased by 19.4 percent adjusted for foreign exchange. Return on sales in the region rose by 4.0 percentage points to 23.2 percent.

In the Eastern Europe region, we increased sales organically by 4.5 percent in a challenging market environment, mainly helped by our business performance in Russia and Turkey.

Operating profit in the region decreased by 3.6 percent adjusted for foreign exchange. Return on sales in the region declined by 1.3 percentage points to 13.5 percent.

In the Africa/Middle East region, we were able to achieve strong organic sales growth of 6.9 percent in the third quarter of 2016, despite the impacts of geopolitical unrest in some countries.

Our operating profit in the region improved by 39.8 percent adjusted for foreign exchange. Year on year, return on sales improved by 1.0 percentage points, to 7.8 percent.

Key figures by region 1 first nine months 2016

in million euros	Western Europe	Eastern Europe	Africa/ Middle East	North America	Latin America	Asia Pacific	Corporate2	Henkel Group
Sales January –September 2016	4,586	2,061	1,030	2,925	781	2,385	90	13,858
Sales January –September 2015	4,604	2,065	1,011	2,759	846	2,334	97	13,715
Change from previous year	–0.4%	–0.2%	1.9%	6.0 %	–7.6%	2.2%	–	1.0%
Adjusted for foreign exchange	0.3%	8.5%	8.6%	6.6%	13.6%	5.3%	–	5.0%
Organic	0.0%	8.2%	4.9%	1.9%	11.0%	2.3%	–	3.0%
Proportion of Henkel sales January –September 2016	33 %	15%	7%	21%	6%	17%	1%	100%
Proportion of Henkel sales January –September 2015	34%	15%	7%	20%	6%	17%	1%	100%
Operating profit (EBIT) January – September 2016	1,030	270	111	473	96	351	–83	2,249
Operating profit (EBIT) January – September 2015	925	294	104	400	87	322	–105	2,029
Change from previous year	11.3%	–8.1%	6.5%	18.1%	9.7%	8.9%	–	10.8%
Adjusted for foreign exchange	12.0%	1.2%	17.4%	18.6%	57.2%	13.4%	–	14.9%
Return on sales (EBIT) January – September 2016	22.5%	13.1%	10.8%	16.2%	12.3%	14.7%	–	16.2%
Return on sales (EBIT) January – September 2015	20.1%	14.2%	10.3%	14.5%	10.3%	13.8%	–	14.8%

1 Calculated on the basis of units of 1,000 euros; figures commercially rounded.

2 Corporate = sales and services not assignable to the individual regions and business units.

Organic sales in the North America region increased by 1.6 percent.

We were able to grow operating profit in the region by 8.3 percent adjusted for foreign exchange. Year on year, return on sales in the region declined by 0.9 percentage points to 16.3 percent.

Organic sales growth in the Latin America region amounted to 13.9 percent. Business performance in Mexico made a significant contribution to this improvement.

Operating profit increased by 36.2 percent adjusted for foreign exchange. The return on sales in the region fell versus the prior-year quarter by 0.6 percentage points to 11.8 percent.

Organic sales in the Asia-Pacific region grew by 4.3 percent, mainly as a result of business performance in India, South Korea and China. By contrast, Japan registered a decline in sales.

We were able to increase operating profit by 27.4 percent adjusted for foreign exchange. Return on sales rose year on year by 2.5 percentage points to 16.0 percent.

With an increase of 6.7 percent, our sales in the emerging markets of Eastern Europe, Africa/Middle East, Latin America and Asia (excluding Japan) again made an above-average contribution to the organic growth of the Group. Nominally, sales increased by 1.8 percent to 2,031 million euros. At 43 percent, the share of Group sales from emerging markets was unchanged compared to the third quarter of 2015.

Laundry & Home Care

Key financials 1

Q3/2015	Q3/2016	+/–	1–9/2015	1–9/2016	+/–
1,314	1,479	+12.6%	3,926	4,157	+5.9%
29%	31%	–	29%	30%	–
211	228	+8.0%	600	682	+13.6%
239	265	+11.0%	685	751	+9.6%
16.0%	15.4%	–0.6pp	15.3%	16.4%	+1.1pp
18.2%	17.9%	–0.3pp	17.5%	18.1%	+0.6pp
24.9%	17.7%	–7.2pp	22.2%	20.9%	–1.3pp

pp = percentage points

1 Calculated on the basis of units of 1,000 euros; figures commercially rounded.

2 Adjusted for one-time charges/gains and restructuring charges.

Sales development1

in percent	Q3/2016	1–9/2016
Change versus previous year	12.6	5.9
Foreign exchange	–3.3	–4.1
Adjusted for foreign exchange	15.9	10.0
Acquisitions/divestments	11.9	5.3
Organic	4.0	4.7
of which price	0.4	0.3
of which volume	3.6	4.4

1 Calculated on the basis of units of 1,000 euros.

The Laundry & Home Care business unit recorded solid organic sales growth in the third quarter. Year on year, adjusted operating profit showed double-digit growth. Adjusted return on sales reached 17.9 percent and came in slightly below the high level of the third quarter of 2015 due to the acquisitions in 2016. Acquisitions include The Sun Products Corporation,

purchase of the majority of shares in Expand Global Industries UK Limited, and the take-over of the detergent business and the associated brands of Behdad Chemical Company (see also page 22). By increasing sales and profits we were able to successfully continue our path of profitable growth in the third quarter.

In the following, we comment on our organic sales performance.

Organically (i.e. adjusted for foreign exchange and acquisitions/divestments), we increased sales by 4.0 percent year on year.

The solid organic improvement was mainly driven by our emerging markets. Growth was in the double digits in Asia (excluding Japan) and the Africa/Middle East region. The regions of Eastern Europe and

Innovation

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Further information on product innovations in the Laundry & Home Care business unit can be found on the website: www.henkel.com/brands-and-businesses

strong performance.

We posted solid sales growth in the mature markets. The North America region recorded a solid increase in sales. In the Western Europe region, we achieved positive sales performance in an environment of intense competition.

We increased adjusted operating profit (EBIT) versus the prior-year quarter by 11.0 percent to 265 million euros. Both adjusted return on sales and gross margin were slightly lower year on year due to acquisitions. Excluding the acquisitions in 2016, adjusted return on sales exhibited strong growth, with gross margin also above the level of the prior-year quarter. At 17.7 percent, return on capital employed (ROCE) was lower year on year, mainly due to the acquisitions in 2016. Due to acquisitions, net working capital as a percentage of sales was higher, compared to the third quarter of 2015, at –2.9 percent. Excluding the acquisitions in 2016, net working capital in percent of sales improved year on year.

Numerous innovations strengthened our two business areas:

In the Laundry Care business area, we recorded strong organic growth in the third quarter. Our heavy-duty detergents made a significant contribution to this performance, particularly our top brand Persil, which posted very strong growth.

In the premium detergent category, we strengthened Persil ProClean in North America by expanding distribution. We advanced Persil's market leadership in South Korea with the launch of a new variant: Persil Hygiene Gel with the power of eucalyptus removes not only the most stubborn stains, but also dust mite residue, which has been known to cause allergies – for hygienically clean laundry.

In the category of value-for-money detergents, we launched the Aromatherapy series in Australia and New Zealand. This new range under the Fab brand features intense, sensual fragrances.

In the fabric softeners category, we improved the formulations of the variants available under the Vernel and Silan brands. As a result, the concentrates now keep laundry fresh and fragrant for up to ten weeks. The sensual scent of the Aromatherapy range was enriched by floral nectar essences. The formula and fragrant appeal of the successful Soft&Oils range

Latin America contributed solid sales growth to the Top brands were further improved. We also added a new variant – Inspiring Orange Oil featuring a seductive fragrance – to the Soft&Oils range. The new formulations and the new variant were rolled out in more than 20 countries in Eastern and Western Europe.

The Home Care business area recorded positive organic growth in the third quarter. Among the growth drivers were our WC products and our automatic dishwashing products.

In the hand dishwashing category, we launched the new "double decruster" formula of Pril in 18 Eastern European countries following its successful introduction in Western Europe. New Pril "double decruster" features for the first time two enzymes and impressively removes residues including both dried-on starches and protein-based substances such as egg, milk, meat and fish. In Africa/Middle East, we built on the success of the latest Pril innovation in Egypt by launching it in other countries in the region, including Tunisia, Algeria and Iran. The new Pril is the first liquid hand dishwashing product in the region to feature a formula containing enzymes that can break down and dissolve starch residues.

In the household cleaners category, we launched our successful spray surface cleaners in the countries around the Persian Gulf and in South Korea. Their innovative formula acts immediately on even stubborn stains, removing them effortlessly without leaving any residue. The products also have a pleasantly fresh smell.

In the WC products category, we optimized the formula of our rim blocks sold under the Bref Power Aktiv brand. Bref Power Aktiv is number one in the WC rim block segment of our active markets. The products in the range are now available with an innovative "power core" loaded with 40 percent more perfume for a longer-lasting, fresh fragrance boost. The new formula has already been introduced in more than 35 countries in Western and Eastern Europe.

Beauty Care

Key financials 1

Q3/2015	Q3/2016	+/–	1–9/2015	1–9/2016	+/–
964	968	+0.4%	2,910	2,906	–0.1%
21%	20%	–	21%	21%	–
142	155	+9.1%	433	459	+6.0%
155	170	+9.7%	471	499	+6.1%
14.7%	16.0%	+1.3pp	14.9%	15.8%	+0.9pp
16.1%	17.5%	+1.4pp	16.2%	17.2%	+1.0pp
20.2%	20.6%	+0.4pp	21.2%	21.4%	+0.2pp

pp = percentage points

1 Calculated on the basis of units of 1,000 euros; figures commercially rounded.

2 Adjusted for one-time charges/gains and restructuring charges.

Sales development1

Q3/2016	1–9/2016
0.4	–0.1
–3.7	–3.9
4.1	3.8
1.5	1.3
2.6	2.5
0.8	0.5
1.8	2.0

1 Calculated on the basis of units of 1,000 euros.

The Beauty Care business unit recorded solid organic sales growth in the third quarter. Adjusted operating profit showed very strong growth compared to the prior-year quarter. There was an excellent increase in adjusted return on sales, taking it to a new high of 17.5 percent. Thus, we were able to continue our long-established path of profitable growth.

Innovation

In the following, we comment on our organic sales performance.

Organically (i.e. adjusted for foreign exchange and acquisitions/divestments), we increased sales by 2.6 percent compared to the prior-year quarter.

From a regional perspective, our business performance showed continued success in the emerging markets with a very strong growth rate recorded. In particular, the regions of Eastern Europe and Latin America contributed double-digit sales growth to the good results achieved. Sales in Asia (excluding Japan) came in below the level of the third quarter of the previous year, while in the Africa/Middle East region we were able to achieve very strong growth.

Sales development in the mature markets was flat. Due to persistently intense crowding-out competition and strong price pressure, sales in both the

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the Asia-Pacific region were down on the third quarter of 2015. In the North America region we were able to continue our successful growth trajectory with a solid increase in sales.

We again saw adjusted operating profit improve significantly, to 170 million euros. Adjusted return on sales reached 17.5 percent. Due to our ongoing measures to reduce costs and enhance our production and supply chain efficiency, gross margin came in at the level of the prior-year quarter. At 20.6 percent, return on capital employed (ROCE) was above the figure for the third quarter of 2015. Net working capital as a percentage of sales was, at 3.3 percent, below the already low level of the prior-year quarter.

Numerous innovations strengthened our businesses:

Our Branded Consumer Goods business area again posted a solid sales performance in the third quarter, supported by a number of successful innovations.

In the strategically important Hair Colorants business, Syoss Oleo Intense made a positive impression on the market with its new Smoky Blonde nuances. These contain activating oil boosters and ashy micropigments to give the hair natural glossy, elegant blond tones with cool reflexes. Palette Permanent Natural Colors Creme has been reformulated with precious argan oil for intensive hair care and an exceptional, natural-looking coloration result with multi-color reflexes.

In the Hair Care business, we profited from the launch of Gliss Kur Oil-In-Shampoo. Thanks to the innovative micro-oil emulsion technology for weightless care and suppleness, these shampoos provide a completely new hair-washing experience. In addition, our successful line Syoss Oleo 21 for intensive nutritious care has been revised so that now, with a complex of 21 oils, it can offer 100 percent, deep-down nutritious care combined with an anti-straw effect for up to 24 hours. Under the Schauma brand we launched the new line Heavenly Long with Cherry Blossom Essence, especially developed for long hair.

In the Styling business, we further strengthened our Taft brand with the introduction of Taft Ultra Control, Taft Restyler and Taft Chaos Styler. Taft Ultra Control provides 24 hours of ultra-strong hold while protect-

Western Europe region and the mature markets of Top brands ing against hair static and flyaways. Taft Restyler and Chaos Styler have been especially developed for creating individual, trendy looks.

The Body Care business saw the launch of the Fa Dry Protect series. The formula based on Micro-Absorber technology offers an immediate feeling of dryness and 48 hours of protection from underarm wetness. In addition, the aerosol portfolio has been improved through the introduction of Soft & Precise spray technology. Fa Men has been expanded with the new lines Fa Men Sport Energy Boost and Fa Men Sport Recharge. In North America, the new body wash Dial For Men Maximum Moisture with a vitamin complex comprising Vitamin E and Vitamin B has proven popular. It thoroughly cleanses the skin and prevents it from dehydrating.

The Skin Care business was strengthened through the introduction of Diadermine Lift+ Super Corrector, our first anti-aging innovation capable of combating both existing and future pigmentation spots. In the cleansing segment we also launched Diadermine Essentials Micellar Waters onto the market – a mild yet effective facial water.

Within the Oral Care business, we have strengthened the Freshness variants of the Theramed 2in1 line with improved formulations. The new technology creates a three times fresher feel while also ensuring a thorough antibacterial clean.

Our Hair Salon business area posted positive sales growth in the third quarter of 2016 versus the prioryear quarter. We stimulated strong growth momentum with our innovations in the professional coloration and hair care categories.

With new Igora Royal Highlifts, Schwarzkopf Professional has introduced onto the market the first blonding products in which the innovative Fibre Bond technology is already integrated in the colorant cream without the need for additional mixing – for minimized hair breakage and the coolest blonde tones of all time from Igora. In the Care category, BC Fibre Force offers the first strengthening hair care system with patent-pending Bond Connector technology for ten times more resistance to hair breakage. Meanwhile, the Strong Sexy Hair line of our North American professional brand Sexy Hair imparts strength and flexibility to damaged and mature hair.

Adhesive Technologies

Key financials 1

Q3/2015	Q3/2016	+/–	1–9/2015	1–9/2016	+/–
2,279	2,272	–0.3%	6,783	6,705	–1.1%
49%	48%	–	49%	48%	–
367	423	+15.3%	1,100	1,190	+8.1%
412	430	+4.4%	1,163	1,232	+5.9%
16.1%	18.6%	+2.5pp	16.2%	17.7%	+1.5pp
18.1%	18.9%	+0.8pp	17.2%	18.4%	+1.2pp
18.5%	21.6%	+ 3.1pp	18.4%	20.3%	+ 1.9pp

pp = percentage points

1 Calculated on the basis of units of 1,000 euros; figures commercially rounded.

2 Adjusted for one-time charges/gains and restructuring charges.

Sales development1

in percent	Q3/2016	1–9/2016
Change versus previous year	–0.3	–1.1
Foreign exchange	–3.1	–4.0
Adjusted for foreign exchange	2.8	2.9
Acquisitions/divestments	0.3	0.5
Organic	2.5	2.4
of which price	–0.1	0.3
of which volume	2.6	2.1

1 Calculated on the basis of units of 1,000 euros.

The Adhesive Technologies business unit recorded solid organic sales growth in the third quarter. Adjusted operating profit showed a solid increase compared to the prior-year quarter. There was a very strong improvement in adjusted return on sales, taking it to a new high of 18.9 percent.

In the following, we comment on our organic sales performance.

Organic sales growth (i.e. sales growth adjusted for foreign exchange and acquisitions/divestments) amounted to 2.5 percent, generated by volume increases.

Our businesses in emerging markets produced strong sales growth with a double-digit increase in the Latin America region. We achieved solid sales growth in the Eastern Europe region, while sales in the Africa/Middle East region were lower year on year. Sales in Asia (excluding Japan) grew very strongly.

Sales in the mature markets declined slightly. They were down year on year in the Western Europe and

Innovation

Bonderite solutions for Metal Packaging

Our new lubricants and cooling agents in the Bonderite L-FM series enable our Metal Packaging customers to raise both their productivity and sustainability. With an improved biostable formulation, the products increase machine capacities to 3,000 cans per minute. At the same time, their use reduces scrap rates, which means less waste. Together with our Bonderite cleaners, we offer leading solutions to this globally growing market. www.henkel-adhesives.com/metal-packaging-solutions

Further information on product innovations in the Adhesive Technologies business unit can be found on the website: www.henkel.com/brands-and-businesses

region.

Adjusted operating profit (EBIT) showed a solid increase to 430 million euros. At 18.9 percent – up 0.8 percentage points – adjusted return on sales increased very strongly versus the third quarter of 2015. We were able to improve gross margin through, among other things, our ongoing measures to reduce costs and enhance production and supply chain efficiency. At 21.6 percent, return on capital employed (ROCE) rose by 3.1 percentage points year on year, driven by operating profit. Net working capital as a percentage of sales improved compared to the third quarter of 2015. The figure of 11.7 percent was below the already low level of the prior-year quarter.

Sales growth was positive in the Packaging and Consumer Goods Adhesives business area. We were able to expand our business in the packaging adhesives category, especially with globally positioned brand manufacturers in North America. In flexible food packaging, for example, not just our safe, highperformance laminating adhesives made a positive impression but also the underlying test methods adopted to ensure qualification of the packaging under the various global food safety regulations.

Sales growth in the Transport and Metal business area was very strong, driven consistently by our products and solutions for global automotive manufacturers and suppliers. We also generated growth in the Metal Packaging category, where our technologies and comprehensive service portfolio enable faster machine runtimes and improved efficiency. By acquiring new customers for these products, we were able to further extend our market leadership.

Asia-Pacific regions, and flat in the North America Top brands Sales growth in the General Industry business area was solid, with key momentum coming from our polyurethane-based two-component structural adhesives for high-performance equipment and machinery in various industries, ranging from medical technology to household appliances. For example, our innovative glass bonding solutions have led to an alliance with a leading household appliance manufacturer. Apart from increasing the performance capabilities of the final products, customers also benefit from improved efficiency during the manufacturing process.

Sales growth in the Electronics business area was very strong, driven mainly by our innovative Consumer Electronics products. For example, our smartphone solutions enable manufacturers to bring devices to market that are increasingly faster, smaller and better performing. Nowadays, as many as 50 different products and solutions provided by Henkel are incorporated into a single smartphone. Our solutions for the semiconductor industry also generated strong business performance.

Sales in the Adhesives for Consumers, Craftsmen and Building business area were below the level of the prior-year quarter, mainly due to lower sales from the building segment in the Africa/Middle East region. However, the relaunch of our Loctite superglue product range provided positive stimulus. The Perfect Pen – our innovative pen-shaped household adhesive – played a key role in further expanding our market leadership in this segment.

Financial report January through September 2016

Underlying economic conditions

The general economic conditions described here are based on data published by IHS Global Insight.

The world economy grew by approximately 2.5 percent in the first nine months of 2016 compared to the prior-year period. Industrial production increased in the same period by approximately 1.5 percent. Growth in private consumption was moderate at approximately 2.5 percent.

The mature markets registered robust economic growth. According to IHS, the North American economy grew by approximately 1.5 percent in the first nine months of 2016. Both the Western European and the German economies reported growth of around 1.5 percent.

The emerging markets of Asia (excluding Japan) grew by approximately 5.5 percent in the first nine months of 2016. Compared to the first nine months of 2015, economic performance in Latin America declined by approximately 1 percent, while the Eastern European economy grew by approximately 1.5 percent.

Year on year, the euro depreciated slightly against the US dollar in the first nine months of 2016 to 1.12 US dollars. Around the world, consumer prices rose by approximately 3 percent. Global unemployment was approximately 7 percent.

Sectors of importance for Henkel

Private consumption increased by approximately 2.5 percent in the first nine months of 2016. Consumers in North America increased their spending by approximately 2.5 percent; consumer spending in Western Europe grew by approximately 2 percent. Consumption in the emerging markets grew in the first nine months by approximately 3.5 percent, according to IHS.

At approximately 1.5 percent, industrial production expanded in the first nine months of 2016 at a slower pace than the economy as a whole. Production growth in the transport sector was approximately 1.5 percent for the first nine months of 2016; growth in the automotive industry was below this figure and remained on the level of prior year. IHS reported an increase of approximately 3 percent for the electronics sector, whereas the metals industry remained at the level recorded in the first nine months of 2015. Growth in consumer-related sectors such as the global packaging industry was sluggish at approximately 0.5 percent. Global construction grew by approximately 2 percent in the first nine months of this year.

Effects on Henkel

Despite conditions characterized by modest private spending, we managed to achieve organic growth in our consumer businesses. Organic sales in the Adhesive Technologies business unit grew by 2.4 percent between January and September 2016, thus outpacing industrial production overall.

Year on year, gross margin increased by 0.2 percentage points to 48.9 percent for the first nine months of 2016, helped by savings from cost reduction measures and efficiency improvements, selective price increases and lower prices for direct materials, all of which more than offset the impact of negative foreign exchange rate movements and the effect of acquisitions.

Business performance January through September 2016

Key financials 1

1–9/2015	1–9/2016	+/–
13,715	13,858	1.0%
2,029	2,249	10.8%
2,253	2,407	6.9%
14.8%	16.2%	1.4pp
16.4%	17.4%	1.0pp
1,475	1,662	12.7%
1,632	1,772	8.6%
3.41	3.84	12.6%
3.77	4.09	8.5%

pp = percentage points

1 Calculated on the basis of units of 1,000 euros; figures commercially rounded.

2 Adjusted for one-time charges/gains and restructuring charges.

Results of operations

We increased sales by 1.0 percent to 13,858 million euros in the first nine months of fiscal 2016. Adjusted for foreign exchange, sales improved by 5.0 percent. With growth of 3.0 percent, organic sales, i.e. adjusted for foreign exchange and acquisitions/divestments, showed a solid rate of increase compared to the first nine months of 2015.

Sales development1

in percent	1–9/2016
Change versus previous year	1.0
Foreign exchange	–4.0
Adjusted for foreign exchange	5.0
Acquisitions/divestments	2.0
Organic	3.0
of which price	0.3
of which volume	2.7

1 Calculated on the basis of units of 1,000 euros.

All business units contributed to this performance. The Laundry & Home Care business unit recorded solid organic sales growth of 4.7 percent. Organic sales growth was also solid in the Beauty Care business unit, at 2.5 percent, Adhesive Technologies achieved solid organic growth of 2.4 percent.

Price and volume effects first nine months 2016

in percent	Organic sales growth	of which price	of which volume
Laundry & Home Care	4.7	0.3	4.4
Beauty Care	2.5	0.5	2.0
Adhesive Technologies	2.4	0.3	2.1
Henkel Group	3.0	0.3	2.7

There were no significant changes in the first nine months of 2016 with respect to the description of our business activities and competitive position as presented in our Annual Report 2015 on page 57.

In order to adapt our structures to our markets and customers, we spent 103 million euros on restructuring (prior-year period: 161 million euros). To build a scalable business model, we are expanding our shared services and progressing with the combination of our supply chain and sourcing activities into one integrated global supply chain organization. We are also advancing with the integration of our acquisitions.

Reconciliation from sales to adjusted operating profit1
---------------------------------------------------------	--	--	--	--

in million euros	1–9/2015	%	1–9/2016	%	+/–
Sales	13,715	100.0	13,858	100.0	1.0%
Cost of sales	–7,034	–51.3	–7,083	–51.1	0.7%
Gross profit	6,681	48.7	6,775	48.9	1.4%
Marketing, selling and distribution expenses	–3,448	–25.1	–3,384	–24.4	–1.9%
Research and development expenses	–351	–2.6	–345	–2.5	–1.7%
Administrative expenses	–662	–4.8	–634	–4.5	–4.2%
Other operating income/expenses	33	0.2	–5	–0.1	–
Adjusted operating profit (EBIT)	2,253	16.4	2,407	17.4	6.9%

1 Calculated on the basis of units of 1,000 euros; figures commercially rounded.

Compared to the first nine months of 2015, cost of sales increased by 0.7 percent to 7,083 million euros. Gross profit increased by 1.4 percent to 6,775 million euros. Savings from cost reduction measures and efficiency improvements, selective price increases and lower prices for direct materials more than offset the impact of negative foreign exchange rate movements and the effect of acquisitions, enabling us to increase gross margin by 0.2 percentage points to 48.9 percent.

Compared to the first nine months of 2015, marketing, selling and distribution expenses declined to 3,384 million euros. At 24.4 percent, the ratio to sales was lower year on year. We spent a total of 345 million euros on research and development. The ratio to sales, at 2.5 percent, was slightly lower year on year. Administrative expenses declined compared to the prior-year period, from 662 million euros to 634 million euros. At 4.5 percent, administrative expenses in relation to sales were slightly below the level of the first nine months of 2015.

At –5 million euros, the balance of other operating income and charges was lower year on year, due mainly to lower gains on disposals of non-current assets.

Adjusted operating profit (EBIT) increased by 6.9 percent from 2,253 million euros to 2,407 million euros. We increased the adjusted return on sales of the Henkel Group from 16.4 percent to 17.4 percent. The Laundry & Home Care business unit recorded a strong margin improvement with an increase of 0.6 percentage points, from 17.5 percent to 18.1 percent. The performance of the Beauty Care business unit was excellent, with return on sales increasing by 1.0 percentage points to 17.2 percent. The Adhesive Technologies business unit also registered an excellent increase in margin of 1.2 percentage points, taking it from 17.2 percent to 18.4 percent.

Our financial result improved from –31 million euros in the first nine months of 2015 to –23 million euros in the first nine months of 2016. This is attributable both to the improvement in the net interest result and an improvement in the foreign exchange result. The tax rate was 23.9 percent (adjusted: 24.3 percent).

Net income for the first nine months increased by 12.4 percent from 1,507 million euros to 1,694 million euros. After deducting 32 million euros attributable to non-controlling interests, net income for the period was 1,662 million euros (prior-year period: 1,475 million euros). Adjusted net income after deducting non-controlling interests was 1,772 million euros compared to 1,632 million euros in the first nine months of 2015.

We increased earnings per preferred share (EPS) from 3.41 euros to 3.84 euros. After adjustment, EPS amounted to 4.09 euros versus 3.77 euros in the comparable period of 2015.

Guidance versus performance 2016

	Guidance for 20161	Results first nine months 2016
Organic sales growth	Henkel Group: 2–4 percent	Henkel Group: 3.0 percent
	All business units within this range	Laundry & Home Care: 4.7 percent Beauty Care: 2.5 percent Adhesive Technologies: 2.4 percent
Percentage of sales from emerging markets	Slight decrease compared to prior-year level	Slight decrease compared to prior-year level
Adjusted return on sales (EBIT)	Increase to more than 16.5 percent	Increase to 17.4 percent
Adjusted earnings per preferred share Increase of 8–11 percent		Increase of 8.5 percent

1 Updated in August 2016.

Comparison between actual business performance and guidance

We updated our guidance for full fiscal 2016 in August of this year:

We expect the Henkel Group to generate organic sales growth of 2 to 4 percent. We furthermore anticipate a slight decrease in the share of sales from our emerging markets due to foreign exchange effects. For adjusted return on sales (EBIT), we forecast an increase to more than 16.5 percent for fiscal 2016 and anticipate that the adjusted return on sales of each individual business unit will be above the level of the previous year. We expect an increase in adjusted earnings per preferred share of between 8 and 11 percent.

We confirm this guidance for fiscal 2016.

Net assets

Compared to year-end 2015, total assets rose by 5.6 billion euros to 27.9 billion euros.

Under non-current assets, intangible assets increased by 3.1 billion euros while the value of property, plant and equipment rose by 0.3 billion euros, mainly as a result of acquisitions. Capital expenditures of 307 million euros on property, plant and equipment were partially offset by depreciation of 265 million euros.

Current assets increased from 6.9 billion euros to 9.0 billion euros. This was attributable in particular to higher trade accounts receivable and a higher volume of cash and cash equivalents, which increased by 1.2 billion euros in the reporting period.

Compared to year-end 2015, equity including noncontrolling interests increased by 485 million euros to 14,296 million euros. The individual components influencing equity development are shown in the consolidated statement of changes in equity on page 30. Equity rose with the addition of net income for the first nine months amounting to 1,694 million euros. The dividend distribution in April 2016, negative effects amounting to 241 million euros from the remeasurement of the net liability from defined benefit pension plans, and negative foreign exchange effects of 251 million euros led to a reduction in equity. The debt-financed acquisition of the shares in The Sun Products Corporation caused the equity ratio to decrease to 51.2 percent, 10.7 percentage points lower than the level as of the end of 2015.

Financial structure

Non-current liabilities increased by 3.4 billion euros to 5.6 billion euros, mainly due to the acquisition of the shares in The Sun Products Corporation. This item was also affected by our pension obligations, which rose compared to year-end 2015 as a consequence of lower discount rates. The increase was mitigated by an above-average return on plan assets and by our allocations to pension funds.

Current liabilities increased by 1.6 billion euros to 8.0 billion euros, primarily due to the increase in borrowings resulting from the issuance of commercial paper. We also recorded an increase in trade accounts payable.

Net financial position

1 Including purchase of non-controlling interests with no change of control.

2 Primarily foreign exchange effects.

Effective September 30, 2016, our net financial position1 amounted to –2,661 million euros (December 31, 2015: 335 million euros). The change compared to the end of the previous year was primarily due to the dividends paid and payments for acquisitions.

Net financial position

in million euros
Q3/2015	–336
Q4/2015	335
Q1/2016	452
Q2/2016	–118
Q3/2016	–2,661

Our operating debt coverage in the reporting period was above the target of 50 percent, as it was at yearend 2015. The reduction in operating debt coverage is primarily due to the decrease in net financial position following financing of the acquisitions in 2016. The interest coverage ratio improved further, benefiting from a strong interest result in the first nine months of 2016.

Key financial ratios

	Dec. 31, 2015	Sept. 30, 2016
Operating debt coverage (net income + amortization and depreciation, impairment and write-ups + interest element of pension obligations) /net borrowings and pension obligations	375.2%	72.0%
Interest coverage ratio EBITDA/ interest result including interest element of pension obligations	75.7	116.7
Equity ratio equity / total assets	61.9%	51.2%

Financial position

The development of our financial position is indicated in detail in the consolidated statement of cash flows on page 31.

At 2,048 million euros, cash flow from operating activities in the first nine months of 2016 was significantly higher than the comparable figure of the prior-year period (1,392 million euros). Apart from the increase in operating profit, this rise was attributable to lower outflows for income taxes and inventories and higher inflows from trade accounts payable compared to the first nine months of 2015. The higher cash flow from operating activities is also reflected in net working capital2 relative to sales, which improved by 0.8 percentage points to 5.2 percent year on year.

The cash outflow in cash flow from investing activities (–4,043 million euros) was significantly higher versus the prior-year period (–678 million euros), primarily due to higher investments in subsidiaries and other business units compared to the first nine months of 2015.

The cash inflow in cash flow from financing activities of 3,191 million euros (prior-year period: –699 million euros) resulted mainly from borrowings in connection with acquisitions. Higher dividend payments and allocation to pension funds reduced this figure.

Cash and cash equivalents rose compared to December 31, 2015 by 1,166 million euros to 2,342 million euros.

The increase in free cash flow to 1,573 million euros in the first nine months of 2016 (prior-year period: 908 million euros) largely resulted from significantly higher cash flow from operating activities.

1 Cash and cash equivalents plus readily monetizable financial instruments classified as "available for sale" or using the "fair value option," less borrowings, plus positive and less negative fair values of hedging transactions.

2 Inventories plus payments on account, receivables from suppliers and trade accounts receivable, less trade accounts payable, liabilities to customers, and current sales provisions.

Capital expenditures

Investments in property, plant and equipment for existing operations totaled 307 million euros, following 351 million euros in the first nine months of 2015. We invested 63 million euros in intangible assets (prior-year period: 82 million euros). Around two-thirds of the expenditures were channeled into expansion projects, innovation, and rationalization measures, which included increasing our production capacity, introducing innovative product lines, and optimizing our production structure and business processes.

Major individual projects in 2016 to date:

Expansion of production capacity and optimization of the logistics structure in Russia (Laundry & Home Care)
Expansion of production capacity in Italy (Laundry & Home Care)
Expansion of warehousing and logistics capacities in Germany (Laundry & Home Care)
Consolidation of our production footprint and expansion of production capacities in China (Adhesive Technologies)
Global optimization of the supply chain, and consolidation and optimization of our IT system architecture for managing business processes

In regional terms, capital expenditures focused primarily on Western Europe, Eastern Europe and Asia-Pacific.

Capital expenditures first nine months 2016

in million euros	Existing operations	Acquisitions	Total
Intangible assets	63	3,353	3,416
Property, plant and equipment	307	341	648
Total	370	3,694	4,064

Acquisitions and divestments

Effective June 1, 2016, we completed the acquisition of a range of hair care brands and the associated hair care business of Procter & Gamble in the Africa/Middle East and Eastern Europe regions.

Effective August 15, 2016, we completed the acquisition of all shares of Zhejiang Golden Roc Chemicals Co. Ltd., China, expanding our superglue business in the Adhesive Technologies business unit.

Effective August 21, 2016, we completed the acquisition of the detergent business and the associated brands of Behdad Chemical Company PJSC in Iran.

Effective September 1, 2016, we completed the acquisition of all shares of The Sun Products Corporation, a laundry and home care company based in Wilton, Connecticut, USA.

Further details can be found in the selected explanatory notes on pages 35 to 37. There were no changes resulting to our business and organizational structure. For detailed information on our organization and business activities, please refer to the disclosures in our Annual Report 2015 on page 57.

Our long-term ratings remain at "A flat" (Standard & Poor's) and "A2" (Moody's). These are also our target ratings. Looking forward, we intend not to jeopardize these when assessing possible acquisitions.

Subsequent events

Employees

As of September 30, 2016, we had around 51,700 employees (December 31, 2015: around 49,450).

The increase compared to year-end 2015 is largely due to the acquisitions in our Laundry & Home Care business unit – and especially to the acquisition of laundry and home care company The Sun Products Corporation in the USA.

Employees by region

Research and development

In the first nine months of 2016, research and development expenditures amounted to 348 million euros (adjusted for restructuring charges: 345 million euros) compared to 361 million euros (adjusted: 351 million euros) in the prior-year period. Relative to sales, research and development expenditures declined by 0.1 percentage points year on year. The ratio was 2.5 percent (adjusted: 2.5 percent).

The development of innovative products is of key importance to our business model. The research and development strategy described in our Annual Report 2015 (starting on page 83) has remained unchanged.

After September 30, 2016, there were no reportable events of particular significance for the net assets, financial position and results of operations of the Group.

Outlook

Our assessment of future world economic development is based on data provided by IHS Global Insight.

Global economic growth is expected to remain no more than moderate in 2016. IHS expects gross domestic product to rise by approximately 2.5 percent. For the mature markets, IHS anticipates growth of approximately 1.5 percent. For Western Europe, the expected increase is approximately 1.5 percent, and for North America, IHS also expects growth of 1.5 percent for the full year. The Japanese economy is expected to grow by approximately 0.5 percent.

The emerging markets are expected to achieve economic growth of approximately 4 percent in 2016. IHS expects economic output to increase by approximately 5.5 percent in Asia (excluding Japan) and by approximately 2 percent in the Africa/Middle East region. A decline in the economy in Latin America of approximately 1 percent is forecasted. In Eastern Europe, the economy is expected to grow by approximately 1.5 percent in 2016.

We expect continued high volatility in the currency markets. We anticipate a roughly constant average US dollar rate for 2016 compared to 2015. By contrast, major currencies in the emerging markets could weaken.

Global inflation of around 5 percent is predicted in 2016. IHS anticipates an increase in price levels of approximately 1 percent in the mature markets, while inflation of around 11 percent is expected for the emerging markets.

IHS predicts that global private consumption will increase by approximately 2.5 percent in 2016. In the mature markets, consumers are likely to spend approximately 2 percent more than in the previous year. The emerging markets should exhibit a somewhat higher propensity to spend, with an increase of approximately 3.5 percent in 2016.

Global industrial production should expand moderately by around 2 percent year on year, less than the world economy as a whole. In the transport and automotive sector, IHS expects growth of around 2 percent, while the metal industry is projected to grow by around 1 percent. Growth of approximately 4 percent is expected in the electronics sector. In consumerrelated sectors, such as the global packaging industry, growth is forecasted to again be in the low singledigit range in 2016. For global construction output, IHS expects an increase of approximately 3 percent.

Opportunities and risks

Our evaluation of opportunities and risks and our current assessment of the risks arising from legal disputes are unchanged from the analysis provided in our Annual Report 2015. The presentation of the major risk and opportunity categories can be found on pages 108 to 113 of our Annual Report 2015.

At the time this report was prepared, there were no identifiable risks related to future developments that could endanger the existence either of Henkel AG & Co. KGaA, or a material subsidiary included in the consolidation, or the Group, as a going concern.

Outlook for the Henkel Group in 2016

We updated our guidance for full fiscal 2016 in August of this year: We expect the Henkel Group to generate organic sales growth of 2 to 4 percent. We anticipate that each business unit will generate growth within this range.

Regarding the share of sales from our emerging markets, we expect a slight decrease compared to the prior-year level due to foreign exchange effects.

The starting point for our expected organic sales growth is our strong competitive position. We have consolidated and further developed this in recent years through our innovative strength, strong brands and leading market positions, as well as the quality of our portfolio.

For adjusted return on sales (EBIT), we forecast an increase to more than 16.5 percent for fiscal 2016 and anticipate that the adjusted return on sales of each individual business unit will be above the level of the previous year. We expect an increase in adjusted earnings per preferred share of between 8 and 11 percent.

We confirm this guidance for fiscal 2016.

Furthermore, we have updated the following expectations for 2016:

Prices for raw materials, packaging, and purchased goods and services approximately at the level of the previous year (unchanged)
Restructuring charges of 250 to 300 million euros (previously: 150 to 200 million euros); increase due to adaptation of structures in North America as a result of the acquisition of The Sun Products Corporation
Investments in property, plant and equipment and intangible assets of between 550 and 600 million euros (previously: 650 to 700 million euros)

Interim consolidated financial statements

Consolidated statement of financial position

Assets

in million euros	Sept. 30, 2015	%	Dec. 31, 2015		% Sept. 30, 2016	%
Intangible assets	11,221	50.1	11,682	52.3	14,761	52.8
Property, plant and equipment	2,579	11.5	2,661	11.9	2,990	10.8
Other financial assets	61	0.3	63	0.3	65	0.2
Income tax refund claims	6	–	7	–	7	–
Other assets	152	0.7	177	0.8	166	0.6
Deferred tax assets	846	3.8	816	3.7	982	3.5
Non-current assets	14,865	66.4	15,406	69.0	18,971	67.9
Inventories	1,759	7.9	1,721	7.7	1,922	6.9
Trade accounts receivable	3,212	14.3	2,944	13.2	3,471	12.4
Other financial assets	621	2.8	540	2.4	683	2.4
Income tax refund claims	187	0.8	196	0.9	165	0.6
Other assets	480	2.1	330	1.5	361	1.3
Cash and cash equivalents	1,266	5.7	1,176	5.3	2,342	8.4
Assets held for sale	11	–	10	–	17	0.1
Current assets	7,536	33.6	6,917	31.0	8,961	32.1
Total assets	22,401	100.0	22,323	100.0	27,932	100.0

in million euros	Sept. 30, 2015	%	Dec. 31, 2015		% Sept. 30, 2016	%
Issued capital	438	2.0	438	2.0	438	1.6
Capital reserve	652	2.9	652	2.9	652	2.3
Treasury shares	–91	–0.4	–91	–0.4	–91	–0.3
Retained earnings	12,389	55.3	12,984	58.1	13,731	49.1
Other components of equity	–515	–2.3	–322	–1.4	–565	–2.0
Equity attributable to shareholders of Henkel AG & Co. KGaA	12,873	57.5	13,661	61.2	14,165	50.7
Non-controlling interests	135	0.6	150	0.7	131	0.5
Equity	13,008	58.1	13,811	61.9	14,296	51.2
Pension obligations	1,144	5.1	988	4.4	1,167	4.2
Income tax provisions	68	0.3	89	0.4	97	0.3
Other provisions	376	1.7	396	1.8	374	1.3
Borrowings	1,311	5.8	4	–	3,201	11.5
Other financial liabilities	–	–	1	–	96	0.3
Other liabilities	19	0.1	16	0.1	28	0.1
Deferred tax liabilities	620	2.8	670	3.0	663	2.4
Non-current liabilities	3,538	15.8	2,164	9.7	5,626	20.1
Income tax provisions	313	1.4	263	1.2	343	1.2
Other provisions	1,481	6.6	1,564	7.0	1,767	6.3
Borrowings	463	2.1	880	3.9	1,859	6.7
Trade accounts payable	3,189	14.2	3,176	14.2	3,558	12.7
Other financial liabilities	66	0.3	109	0.5	120	0.4
Other liabilities	337	1.5	351	1.6	331	1.3
Income tax liabilities	6	–	5	–	32	0.1
Liabilities held for sale	–	–	–	–	–	–
Current liabilities	5,855	26.1	6,348	28.4	8,010	28.7
Total equity and liabilities	22,401	100.0	22,323	100.0	27,932	100.0

Consolidated statement of income

in million euros	Q3/2015	%	Q3/2016	%	+/–
Sales	4,590	100.0	4,748	100.0	3.4%
Cost of sales1	–2,361	–51.4	–2,453	–51.7	3.9%
Gross profit	2,229	48.6	2,295	48.3	3.0%
Marketing, selling and distribution expenses1	–1,158	–25.2	–1,171	–24.7	1.1%
Research and development expenses1	–120	–2.6	–116	–2.4	–3.3%
Administrative expenses1	–278	–6.1	–232	–4.8	–16.5%
Other operating income	21	0.4	26	0.5	23.8%
Other operating charges	–28	–0.6	–27	–0.6	–3.6%
Operating profit (EBIT)	666	14.5	775	16.3	16.4%
Interest income	5	0.1	7	0.1	40.0%
Interest expense	–13	–0.2	–11	–0.2	–15.4%
Other financial result	–3	–0.1	–11	–0.2	266.7%
Investment result	–	–	–	–	–
Financial result	–11	–0.2	–15	–0.3	36.4%
Income before tax	655	14.3	760	16.0	16.0%
Taxes on income	–161	–3.5	–176	–3.7	9.3%
Tax rate in %	24.6		23.2
Net income	494	10.8	584	12.3	18.2%
Attributable to non-controlling interests	10	0.2	8	0.2	–20.0%
Attributable to shareholders of Henkel AG & Co. KGaA	484	10.6	576	12.1	19.0%
Earnings per ordinary share – basic and diluted in euros	1.11		1.32		18.9%
Earnings per preferred share – basic and diluted in euros	1.12		1.33		18.8%

Additional voluntary information

in million euros	Q3/2015	Q3/2016	+/–
EBIT (as reported)	666	775	16.4%
One-time gains	–	–	–
One-time charges	34	272	–
Restructuring charges1	78	35	–
Adjusted EBIT	778	837	7.6%
Adjusted return on sales in %	16.9	17.6	0.7pp
Adjusted tax rate in %	24.9	24.1	–0.8pp
Adjusted net income – attributable to shareholders of Henkel AG & Co. KGaA	564	616	9.2%
Adjusted earnings per ordinary share in euros	1.29	1.41	9.3%
Adjusted earnings per preferred share in euros	1.30	1.42	9.2%

1 Restructuring charges, third quarter 2016: 35 million euros (third quarter 2015: 78 million euros), of which: cost of sales 11 million euros (third quarter 2015: 10 million euros), marketing, selling and distribution expenses 22 million euros (third quarter 2015: 22 million euros), research and development expenses 0 million euros (third quarter 2015: 6 million euros), administrative expenses 2 million euros (third quarter 2015: 40 million euros).

2 Includes 8 million euros related to the optimization of our IT system architecture for managing business processes (third quarter 2015: 26 million euros),

6 million euros for the integration of acquisitions (third quarter 2015: 0 million euros) and 13 million euros for incidental acquisition costs (third quarter 2015: 8 million euros).

Consolidated statement of income

in million euros	1–9/2015	%	1–9/2016	%	+/–
Sales	13,715	100.0	13,858	100.0	1.0%
Cost of sales1	–7,064	–51.5	–7,119	–51.4	0.8%
Gross profit	6,651	48.5	6,739	48.6	1.3%
Marketing, selling and distribution expenses1	–3,509	–25.6	–3,430	–24.8	–2.3%
Research and development expenses1	–361	–2.6	–348	–2.5	–3.6%
Administrative expenses1	–764	–5.6	–697	–5.0	–8.8%
Other operating income	82	0.6	75	0.5	–8.5%
Other operating charges	–70	–0.5	–90	–0.6	28.6%
Operating profit (EBIT)	2,029	14.8	2,249	16.2	10.8%
Interest income	22	0.2	16	0.1	–27.3%
Interest expense	–36	–0.3	–16	–0.1	–55.6%
Other financial result	–16	–0.1	–22	–0.2	37.5%
Investment result	–1	–	–1	–	–
Financial result	–31	–0.2	–23	–0.2	–25.8%
Income before tax	1,998	14.6	2,226	16.0	11.4%
Taxes on income	–491	–3.6	–532	–3.8	8.4%
Tax rate in %	24.6		23.9
Net income	1,507	11.0	1,694	12.2	12.4%
Attributable to non-controlling interests	32	0.2	32	0.2	–
Attributable to shareholders of Henkel AG & Co. KGaA	1,475	10.8	1,662	12.0	12.7%
Earnings per ordinary share – basic and diluted in euros	3.39		3.82		12.7%
Earnings per preferred share – basic and diluted in euros	3.41		3.84		12.6%

Additional voluntary information

in million euros	1–9/2015	1–9/2016	+/–
EBIT (as reported)	2,029	2,249	10.8%
One-time gains	–	–12	–
One-time charges	63	563	–
Restructuring charges1	161	103	–
Adjusted EBIT	2,253	2,407	6.9%
Adjusted return on sales in %	16.4	17.4	1.0pp
Adjusted tax rate in %	25.0	24.3	–0.7pp
Adjusted net income – attributable to shareholders of Henkel AG & Co. KGaA	1,632	1,772	8.6%
Adjusted earnings per ordinary sharein euros	3.75	4.07	8.5%
Adjusted earnings per preferred share in euros	3.77	4.09	8.5%

1 Restructuring charges, first nine months 2016: 103 million euros (first nine months 2015: 161 million euros), of which: cost of sales 23 million euros (first nine months 2015: 30 million euros), marketing, selling and distribution expenses 46 million euros (first nine months 2015: 61 million euros), research and development expenses 3 million euros (first nine months 2015: 10 million euros), administrative expenses 31 million euros (first nine months 2015: 60 million euros). 2 Gains from performance-related purchase price components.

3 Includes 12 million euros for legal disputes (first nine months 2015: 13 million euros), 21 million euros related to the optimization of our IT system architecture for managing business processes (first nine months 2015: 42 million euros), 6 million euros for the integration of acquisitions (first nine months 2015: 0 million euros) and 17 million euros for incidental acquisition costs (first nine months 2015: 8 million euros).

Consolidated statement of comprehensive income

in million euros	Q3/2015	Q3/2016	1–9/2015	1–9/2016
Net income	494	584	1,507	1,694
Components to be reclassified to income:
Exchange differences on translation of foreign operations	–223	–82	388	–251
Gains from derivative financial instruments (hedge reserve per IAS 39)	6	3	–9	5
Gains from financial instruments in the available-for-sale category (available-for-sale reserve)	–	–	–	–
Components not to be reclassified to income:
Remeasurement of net liability from defined benefit pension plans (net of taxes)	–112	19	116	–241
Other comprehensive income (net of taxes)	–329	–60	495	–487
Total comprehensive income for the period	165	524	2,002	1,207
Attributable to non-controlling interests	8	8	39	29
Attributable to shareholders of Henkel AG & Co. KGaA	157	516	1,963	1,178

Consolidated statement of changes in equity

	capital	Issued					Other components of equity
in million euros	Ordinary shares	Preferred shares	Capital reserve	Treasury shares	Retained earnings	Currency trans lation	Hedge reserve per IAS 39	Available for-sale reserve	Share holders of Henkel AG & Co. KGaA	Non-con trolling interests	Total
At Dec. 31, 2014/ Jan. 1, 2015	260	178	652	–91	11,396	–723	–167	3	11,508	136	11,644
Net income	–	–	–	–	1,475	–	–	–	1,475	32	1,507
Other comprehensive income	–	–	–	–	116	381	–9	–	488	7	495
Total comprehensive income for the period	–	–	–	–	1,591	381	–9	–	1,963	39	2,002
Dividends	–	–	–	–	–564	–	–	–	–564	–29	–593
Sale of treasury shares	–	–	–	–	–	–	–	–	–	–	–
Changes in ownership interest with no change in control	–	–	–	–	–34	–	–	–	–34	–11	–45
Other changes in equity	–	–	–	–	–	–	–	–	–	–	–
At Sept. 30, 2015	260	178	652	–91	12,389	–342	–176	3	12,873	135	13,008
At Dec. 31, 2015/Jan. 1, 2016	260	178	652	–91	12,984	–141	–184	3	13,661	150	13,811
Net income	–	–	–	–	1,662	–	–	–	1,662	32	1,694
Other comprehensive income	–	–	–	–	–241	–248	5	–	–484	–3	–487
Total comprehensive income for the period	–	–	–	–	1,421	–248	5	–	1,178	29	1,207
Dividends	–	–	–	–	–633	–	–	–	–633	–28	–661
Sale of treasury shares	–	–	–	–	–	–	–	–	–	–	–
Changes in ownership interest with no change in control	–	–	–	–	–54	–	–	–	–54	–20	–74
Other changes in equity	–	–	–	–	13	–	–	–	13	–	13
At Sept. 30, 2016	260	178	652	–91	13,731	–389	–179	3	14,165	131	14,296

Consolidated statement of cash flows

in million euros	Q3/2015	Q3/2016	1–9/2015	1–9/2016
Operating profit (EBIT)	666	775	2,029	2,249
Income taxes paid	–185	–149	–556	–427
Amortization/depreciation/ impairment /write-ups of intangible assets and property, plant and equipment1	115	132	339	364
Net gains / losses on disposal of intangible assets and property, plant and equipment, and from divestments	–1	–2	–25	–1
Change in inventories	7	–2	–82	–
Change in trade accounts receivable	26	73	–458	–462
Change in other assets	45	–26	–10	–37
Change in trade accounts payable	31	62	110	261
Change in other liabilities and provisions	65	156	45	101
Cash flow from operating activities	769	1,019	1,392	2,048
Purchase of intangible assets and property, plant and equipment including payments on account	–153	–145	–437	–368
Acquisition of subsidiaries and other business units	–236	–3,320	–286	–3,687
Purchase of associated companies and joint ventures held at equity	–	–	–6	–
Proceeds on disposal of subsidiaries and other business units	–	–	22	–
Proceeds on disposal of intangible assets and property, plant and equipment	5	4	29	12
Cash flow from investing activities	–384	–3,461	–678	–4,043
Dividends paid to shareholders of Henkel AG & Co. KGaA	–	–	–564	–633
Dividends paid to non-controlling shareholders	–12	–10	–29	–28
Interest received	13	2	48	14
Interest paid	–22	–12	–65	–20
Dividends and interest paid and received	–21	–20	–610	–667
Issuance of bonds	–	2,221	–	2,221
Other changes in borrowings	–266	945	–38	1,996
Allocations to pension funds	–12	–14	–44	–167
Other changes in pension obligations	–15	–61	–59	–113
Purchase of non-controlling interests with no change of control	–	–6	–52	–81
Other financing transactions2	–86	5	104	2
Cash flow from financing activities	–400	3,070	–699	3,191
Net change in cash and cash equivalents	–15	628	15	1,196
Effect of exchange rates on cash and cash equivalents	–39	–14	23	–30
Change in cash and cash equivalents	–54	614	38	1,166
Cash and cash equivalents at July 1/ January 1	1,320	1,728	1,228	1,176
Cash and cash equivalents at September 30	1,266	2,342	1,266	2,342

1 Of which: Impairment, first nine months 2016: 10 million euros (first nine months 2015: 11 million euros); third quarter 2016: 6 million euros (third quarter 2015: 0 million euros).

2 Other financing transactions in the first nine months 2016 include payments of –32 million euros for the purchase of short-term securities and time deposits as well as the provision of collateral (the figure for the first nine months 2015 includes payments of –472 million euros). The figure for the third quarter 2016 includes payments of 0 million euros (third quarter 2015: –182 million euros).

Additional voluntary information Reconciliation to free cash flow

in million euros	Q3/2015	Q3/2016	1–9/2015	1–9/2016
Cash flow from operating activities	769	1,019	1,392	2,048
Purchase of intangible assets and property, plant and equipment including payments on account	–153	–145	–437	–368
Proceeds on disposal of intangible assets and property, plant and equipment	5	4	29	12
Net interest paid	–9	–10	–17	–6
Other changes in pension obligations	–15	–61	–59	–113
Free cash flow	597	807	908	1,573

Selected explanatory notes

Group segment report by business unit1

Third quarter 2016	Laundry & Home Care	Beauty Care	Adhesives for Consumers, Craftsmen	Industrial Adhesives	Total Adhesive Technolo gies	Operating business units total	Corporate	Henkel Group
in million euros			and Building
Sales July–September 2016	1,479	968	486	1,786	2,272	4,719	29	4,748
Proportion of Group sales	31%	20%	10%	38%	48%	99%	1%	100%
Sales July–September 2015	1,314	964	509	1,771	2,279	4,557	33	4,590
Change from previous year	12.6%	0.4%	–4.4%	0.8%	–0.3%	3.6%	–13.6%	3.4%
Adjusted for foreign exchange	15.9%	4.1%	–0.7%	3.8%	2.8%	6.8%	–	6.7%
Organic	4.0%	2.6%	–1.3%	3.6%	2.5%	3.0%	–	2.8%
EBIT July–September 2016	228	155	87	337	423	806	–31	775
EBIT July–September 2015	211	142	87	280	367	720	–54	666
Change from previous year	8.0%	9.1%	–0.1%	20.1%	15.3%	11.9%	–	16.4%
Return on sales (EBIT) July–September 2016	15.4%	16.0%	17.9%	18.8%	18.6%	17.1%	–	16.3%
Return on sales (EBIT) July–September 2015	16.0%	14.7%	17.1%	15.8%	16.1%	15.8%	–	14.5%
Adjusted EBIT July–September 2016	265	170	87	343	430	865	–27	837
Adjusted EBIT July–September 2015	239	155	94	318	412	805	–27	778
Change from previous year	11.0%	9.7%	–6.6%	7.6%	4.4%	7.4%	–	7.6%
Adjusted return on sales (EBIT) July–September 2016	17.9%	17.5%	18.0%	19.2%	18.9%	18.3%	–	17.6%
Adjusted return on sales (EBIT) July–September 2015	18.2%	16.1%	18.4%	18.0%	18.1%	17.7%	–	16.9%
Capital employed July–September 20162	5,149	3,007	807	7,041	7,847	16,003	90	16,092
Capital employed July–September 20152	3,392	2,810	910	7,028	7,938	14,140	80	14,220
Change from previous year	51.8%	7.0%	–11.4%	0.2%	–1.1%	13.2%	–	13.2%
Return on capital employed (ROCE) July–September 2016	17.7%	20.6%	43.1%	19.1%	21.6%	20.1%	–	19.3%
Return on capital employed (ROCE) July–September 2015	24.9%	20.2%	38.2%	16.0%	18.5%	20.4%	–	18.7%
Amortization/depreciation/ impairment /write-ups of intangible assets and property, plant andequip ment July–September 2016	47	17	10	55	65	129	3	132
of which impairment losses 2016	4	2	–	–	–	6	–	6
of which write-ups 2016	–	–	–	–	–	–	–	–
Amortization/depreciation/ impairment /write-ups of intangible assets and property, plant and equipment July–September 2015	29	20	11	51	62	111	4	115
of which impairment losses 2015	–	–	–	–	–	–	–	–
of which write-ups 2015	–	–	–	–	–	–	–	–
Capital expenditures (excluding financial assets) July–September 2016	3,308	22	22	66	88	3,418	3	3,421
Capital expenditures (excluding financial assets) July–September 2015	58	77	–67	155	88	223	–4	219
Operating assets July–September 20163	7,903	4,308	1,479	8,593	10,072	22,282	548	22,830
Operating liabilities July–September 2016	2,431	1,475	713	2,051	2,764	6,671	459	7,130
Net operating assets July–September 20163	5,472	2,832	766	6,541	7,307	15,611	90	15,701
Operating assets July–September 20153	5,564	4,018	1,475	8,485	9,960	19,543	426	19,969
Operating liabilities July–September 2015	1,975	1,395	606	1,931	2,538	5,908	346	6,254
Net operating assets July–September 20153	3,589	2,623	869	6,554	7,422	13,635	80	13,715

1 Calculated on the basis of units of 1,000 euros.

2 Including goodwill at cost prior to any accumulated impairment in accordance with IFRS 3.79 (b).

3 Including goodwill at net book value.

Group segment report by business unit1

January – September 2016	Laundry & Home Care	Beauty Care	Adhesives for Consumers, Craftsmen	Industrial Adhesives	Total Adhesive Technolo gies	Operating business units total	Corporate	Henkel Group
in million euros			and Building
Sales January–September 2016 Proportion of Group sales	4,157 30%	2,906 21%	1,385 10%	5,320 38%	6,705 48%	13,768 99%	90 1%	13,858 100%
Sales January–September 2015	3,926	2,910	1,439	5,343	6,783	13,618	97	13,715
Change from previous year	5.9%	–0.1%	–3.8%	–0.4%	–1.1%	1.1%	–7.4%	1.0%
Adjusted for foreign exchange	10.0%	3.8%	1.8%	3.2%	2.9%	5.1%	–	5.0%
Organic	4.7%	2.5%	1.6%	2.7%	2.4%	3.1%	–	3.0%

EBIT January–September 2016	682	459	219	970	1,190	2,331	–83	2,249
EBIT January–September 2015	600	433	217	884	1,100	2,134	–105	2,029
Change from previous year	13.6%	6.0%	1.3%	9.8%	8.1%	9.3%	–	10.8%
Return on sales (EBIT) January–September 2016	16.4%	15.8%	15.8%	18.2%	17.7%	16.9%	–	16.2%
Return on sales (EBIT) January–September 2015	15.3%	14.9%	15.1%	16.5%	16.2%	15.7%	–	14.8%
Adjusted EBIT January–September 2016	751	499	231	1,001	1,232	2,483	–76	2,407
Adjusted EBIT January–September 2015	685	471	224	939	1,163	2,319	–67	2,253
Change from previous year	9.6%	6.1%	3.0%	6.6%	5.9%	7.0%	–	6.9%
Adjusted return on sales (EBIT) January–September 2016	18.1%	17.2%	16.7%	18.8%	18.4%	18.0%	–	17.4%
Adjusted return on sales (EBIT) January–September 2015	17.5%	16.2%	15.6%	17.6%	17.2%	17.0%	–	16.4%
Capital employed January–September 20162	4,355	2,862	773	7,039	7,812	15,028	108	15,136
Capital employed January–September 20152	3,606	2,729	913	7,050	7,963	14,299	96	14,395
Change from previous year	20.8%	4.9%	–15.4%	–0.2%	–1.9%	5.1%	–	5.2%
Return on capital employed (ROCE)
January–September 2016	20.9%	21.4%	37.9%	18.4%	20.3%	20.7%	–	19.8%
Return on capital employed (ROCE) January–September 2015	22.2%	21.2%	31.7%	16.7%	18.4%	19.9%	–	18.8%
Amortization/depreciation/ impairment/write-ups of intangible assets and property, plant and equipment January–September 2016	111	51	32	161	193	355	9	364
of which impairment losses 2016	6	2	1	1	2	10	–	10
of which write-ups 2016	–	–	–	–	–	–	–	–
Amortization/depreciation/ impairment /write-ups of intangible assets and property, plant and equipment
January–September 2015	93	51	31	155	186	330	9	339
of which impairment losses 2015	9	–	–	2	2	11	–	11
of which write-ups 2015	1	–	–	–	–	1	–	1
Capital expenditures (excluding financial assets) January–September 2016	3,577	264	72	144	216	4,057	7	4,064
Capital expenditures (excluding financial assets) January–September 2015	151	122	–3	272	269	542	2	544
Operating assets January–September 20163	6,870	4,176	1,381	8,620	10,001	21,047	480	21,528
Operating liabilities January–September 2016	2,258	1,495	649	2,081	2,730	6,484	373	6,856
Net operating assets January–September 20163	4,612	2,681	732	6,538	7,271	14,564	108	14,671
Operating assets January–September 20153	5,785	4,014	1,454	8,523	9,976	19,776	456	20,232
Operating liabilities January–September 2015	1,983	1,472	583	1,962	2,546	6,001	360	6,361
Net operating assets January–September 20153	3,803	2,542	871	6,560	7,431	13,775	96	13,871

1 Calculated on the basis of units of 1,000 euros.

2 Including goodwill at cost prior to any accumulated impairment in accordance with IFRS 3.79 (b).

3 Including goodwill at net book value.

Reconciliation of adjusted net income

Adjusted net income third quarter

in million euros	Q3/2015	Q3/2016
Adjusted EBIT	778	837
Financial result	–11	–15
Taxes on income (adjusted)	–191	–198
Adjusted net income third quarter	576	624
Attributable to non-controlling interests	12	8
Attributable to shareholders of
Henkel AG & Co. KGaA	564	616

Adjusted net income first nine months

2,407
–23
–580
1,804
32

1,772

Earnings per share

In calculating earnings per share for the period January through September 2016, we have included the standard dividend differential between ordinary and preferred shares for the full year of 2 eurocents (as stipulated in the Articles of Association), weighted on a proportional basis.

Earnings per share

		1–9/2015		1–9/2016
	Reported	Adjusted	Reported	Adjusted
Net income Attributable to shareholders of Henkel AG & Co. KGaA in million euros	1,475	1,632	1,662	1,772
Number of outstanding ordinary shares	259,795,875	259,795,875	259,795,875	259,795,875
Earnings per ordinary share (basic) in euros	3.39	3.75	3.82	4.07
Number of outstanding preferred shares1	174,482,311	174,482,311	174,482,323	174,482,323
Earnings per preferred share (basic) in euros	3.41	3.77	3.84	4.09
Earnings per ordinary share (diluted) in euros	3.39	3.75	3.82	4.07
Earnings per preferred share (diluted) in euros	3.41	3.77	3.84	4.09

1 Weighted average of preferred shares.

Changes in treasury shares

The number of treasury shares held by the Group remained unchanged at 3,680,552 preferred shares at September 30, 2016. This represents 0.84 percent of the capital stock and a proportional nominal value of 3.7 million euros.

Recognition and measurement methods

The interim financial report and interim consolidated financial statements of the Henkel Group for the first nine months of the year and the third quarter have been prepared in accordance with Section 37w of the German Securities Trading Act (Wertpapierhandelsgesetz – WpHG), in accordance with International Financial Reporting Standards (IFRS) – as adopted by the European Union – and consequently in compliance with International Accounting Standard (IAS) 34 "Interim Financial Reporting."

The same accounting principles have been applied as for the 2015 consolidated financial statements, with the exception of the accounting pronouncements recently adopted in fiscal 2016, which are explained on pages 131 and 132 of our Annual Report 2015. These pronouncements do not exert any material influence on the presentation of the interim financial report for the first nine months of the year.

In order to further ensure a true and fair view of our net assets, financial position and results of operations, additional line items have been included in the consolidated statement of financial position, consolidated statement of income, consolidated statement of comprehensive income, consolidated statement of changes in equity, and consolidated statement of cash flows.

To simplify interim financial reporting, IAS 34.41 allows certain estimates and assumptions to be made beyond the scope permitted for annual financial statements, on condition that all material financial information is appropriately presented to enable a proper assessment of the net assets, financial position and results of operations of the company. In calculating taxes on income, the interim tax expense is determined on the basis of the estimated effective income tax rate for the current fiscal year.

The interim report for the first nine months, composed of condensed consolidated financial statements and an interim Group management report, was duly subjected to an auditor's review.

which Henkel AG & Co. KGaA has dominating influence over financial and operating policy, based on the concept of control. The Group has a dominating influence on a company when it is exposed, or has rights, to variable returns from its involvement with the company and has the ability to affect those returns through its power over the company.

The following table shows the changes in the scope of consolidation compared to December 31, 2015:

Scope of consolidation

At January 1, 2016	202
Additions	14
Mergers	–5
Disposals	–2
At September 30, 2016	209

The changes in the scope of consolidation have not had any material effect on the main items of the consolidated financial statements.

Scope of consolidation

In addition to Henkel AG & Co. KGaA as the ultimate parent company, the scope of consolidation as of September 30, 2016 includes eight German and 200 non-German companies in

Material acquisitions and divestments

Acquisitions

	Detergent business in Nigeria, effective May 31, 2016	Hair care business in Africa/Middle East and Eastern Europe, effective June 1, 2016	The Sun Products Corporation, effective September 1, 2016
in million euros	Fair value	Fair value	Fair value	Total
Intangible assets	213	214	2,760	3,187
Property, plant and equipment	13	1	303	317
Other non-current assets	–	8	162	170
Non-current assets	226	223	3,225	3,674
Inventories	9	3	189	201
Trade accounts receivable	1	–	99	100
Liquid funds	2	–	11	13
Other current assets	2	–	10	12
Current assets	14	3	309	326
Total assets	240	226	3,534	4,000
Net assets	223	226	3,197	3,646
Non-current liabilities	6	–	158	164
Other current provisions/liabilities	5	–	44	49
Trade accounts payable	6	–	135	141
Current liabilities	11	–	179	190
Total liabilities	240	226	3,534	4,000

Reconciliation of the purchase price to provisional goodwill

in million euros	2016
Detergent business in Nigeria, effective May 31, 2016
Purchase price	110
Contingent purchase price	113
Fair value of the acquired assets and liabilities	24
Provisional goodwill	199
Hair care business in Africa/Middle East and Eastern Europe, effective June 1, 2016
Purchase price	212
Contingent purchase price	14
Fair value of the acquired assets and liabilities	62
Provisional goodwill	164
The Sun Products Corporation, effective September 1, 2016
Purchase price	3,197
Fair value of the acquired assets and liabilities	1,088
Provisional goodwill	2,109

Effective May 31, 2016, we acquired 57.5 percent of the shares in Expand Global Industries UK Limited, London, UK. Expand Global Industries UK Limited holds nearly 100 percent of the shares in Expand Global Industries Ltd. headquartered in Ibadan, Nigeria, which has a strong presence in the detergent market in Nigeria. With this acquisition, the Laundry & Home Care business unit has expanded its detergent business. The acquisition is part of our strategy to further strengthen our presence in emerging markets. The provisional purchase price was 110 million euros, settled in cash. With regard to the remaining 42.5 percent of shares, put and call contracts have been entered into between Henkel and the seller. Henkel has decided to apply the anticipated acquisition method to account for the acquisitions in the financial statements. Accordingly, acquisition of the outstanding non-controlling shares is already included as part of the first-time consolidation in the form of a contingent purchase price liability of 113 million euros. Please refer to the details on page 38 for Henkel's estimated bandwidth of potential fluctuations arising from changes in valuation parameters. A maximum payment was not agreed. As a consequence of the accounting method applied – the anticipated acquisition method – noncontrolling interests from the acquired business are not disclosed in the statement of comprehensive income. Effects from foreign exchange and measurement of the contingent purchase price liability are recognized directly in equity. This effect is disclosed in the statement of changes in equity as other changes in equity. Provisional goodwill was recognized in the amount of 199 million euros. Because the acquisition was only recently completed, the allocation of the purchase price to the acquired assets and liabilities in accordance with

IFRS 3 "Business Combinations" is provisional. Tax-deductible goodwill is not expected.

Effective June 1, 2016, we completed the acquisition of a range of hair care brands and the associated hair care business of Procter & Gamble in the Africa/Middle East and Eastern Europe regions. The acquisition is part of our strategy to further strengthen our presence in emerging markets. The purchase price was 212 million euros, settled in cash. Provisional goodwill was recognized in an amount of 164 million euros. Because the acquisition was only recently completed, the allocation of the purchase price to the acquired assets and liabilities in accordance with IFRS 3 "Business Combinations" is provisional. Goodwill of 54 million euros was recognized for tax purposes.

Effective June 30, 2016, we acquired the tile adhesives business and the associated brands of the Colombian company Alfagres S.A. With this, the Adhesive Technologies business unit has expanded its business in the segment Adhesives for Consumers, Craftsmen and Building. The acquisition is part of our strategy to further strengthen our presence in emerging markets. We do not expect any material impact from this acquisition on the net assets, financial position and results of operations of Henkel.

Effective August 15, 2016, we completed the acquisition of all shares of Zhejiang Golden Roc Chemicals Co. Ltd., China, expanding our superglue business in the Adhesive Technologies business unit. The acquisition is part of our strategy to further strengthen our presence in emerging markets. We do not expect any material impact from this acquisition on the net assets, financial position and results of operations of Henkel.

Effective August 21, 2016, we completed the acquisition of the detergent business and the associated brands of Behdad Chemical Company PJSC in Iran. The acquisition is part of our strategy to further strengthen our presence in emerging markets. The provisional purchase price was 5,420 billion Iranian rials (around 142 million euros) and was settled in cash. Provisional goodwill was recognized in an amount of 101 million euros. Because the acquisition was only recently completed, the allocation of the purchase price to the acquired assets and liabilities in accordance with IFRS 3 "Business Combinations" is provisional. We do not expect any material impact from this acquisition on the net assets, financial position and results of operations of Henkel.

Effective September 1, 2016, we completed the acquisition of all shares of The Sun Products Corporation, a laundry and home care company based in Wilton, Connecticut, USA. The transaction has a purchase price of around 3.6 billion US dollars including debt paid at closing, and is fully debt-financed. In fiscal 2015, the company generated sales of around 1.6 billion US dollars in the USA and Canada. This acquisition is part of our strategy to invest in attractive country category positions in mature markets. Provisional goodwill was recognized in an amount of 2.1 billion euros. Because the acquisition was only recently completed, the allocation of the purchase price to the acquired assets and liabilities in accordance with IFRS 3 "Business Combinations" is provisional. If the acquired company had been included from January 1, 2016, sales for the Henkel Group for the reporting period January 1 to September 30, 2016, would be higher by 1,095 million euros and income (net of taxes) would be lower by 81 million euros, taking restructuring and integration costs into account. The actual contributions of the company were 113 million euros to sales and –11 million euros to income (net of taxes). Tax-deductible goodwill is not expected.

In the first nine months of 2016, we spent around 62 million euros for the acquisition of the outstanding non-controlling shares in Henkel Pakvash PJSC based in Tehran, Iran, increasing our ownership interest to 97.94 percent.

In the first nine months of 2016, we spent around 10 million euros for the acquisition of the outstanding non-controlling shares in Henkel Industrie AG based in Tehran, Iran, increasing our ownership interest to 100 percent.

Consolidated statement of comprehensive income

Of the components included in other comprehensive income, tax income relating to actuarial losses amounts to 97 million euros (September 30, 2015: tax expenses of 42 million euros) and tax losses from cash flow hedges amount to 3 million euros (September 30, 2015: tax income of 2 million euros).

Financial instruments

Financial instruments assigned to the valuation categories "Available for sale" and "Held for trading" are generally measured at fair value. Other securities, time deposits and financial collateral provided, and other investments which are not measured using the equity method, all of which form part of other financial assets in the statement of financial position, are categorized as "Available for sale." Only the derivative financial instruments held by the Henkel Group which are not included in hedge accounting are designated as "Held for trading."

The following hierarchy is applied in order to determine and disclose the fair value of financial instruments:

Level 1: Fair values which are determined on the basis of quoted, unadjusted prices in active markets.
Level 2: Fair values which are determined on the basis of parameters for which either directly or indirectly derived market prices are available.
Level 3: Fair values which are determined on the basis of parameters for which the input factors are not derived from observable market data.

Of the securities and time deposits measured at fair value in the Henkel Group in the "Available for sale" category, 7 million euros (September 30, 2015: 85 million euros) of the total reported fair value of 9 million euros (September 30, 2015: 87 million euros) is allocated to level 1. The fair value of the financial collateral provided in the "Available for sale" category allocated to level 1 is 5 million euros (September 30, 2015: 331 million euros, of which 329 million euros was netted). All derivative financial instruments are classified as level 2. Derivative financial instruments recognized under other financial assets with a positive fair value have a reported fair value of 86 million euros (September 30, 2015: 102 million euros), while derivative financial instruments recognized under other financial liabilities with a negative fair value amounted to 43 million euros (September 30, 2015: 19 million euros).

In addition to taking out a three-year syndicated bank loan of 1.1 billion dollars to finance the acquisition of The Sun Products Corporation, Henkel issued four fixed-rate bonds in September 2016 with a value of 2.2 billion dollars.

Bonds

Currency	EUR	EUR	USD	GBP
Volume	500 million	700 million	750 million	300 million
Coupon	0% p.a.	0% p.a.	1.5% p.a.	0.875% p.a.
Due date	09/13/2018	09/13/2021	09/13/2019	09/13/2022

The carrying amount (including accrued interest) of the issued bonds, which are reported within borrowings, amounted to 2,214 million euros as of the reporting date. The fair value is 2,221 million euros.

The fair value of securities and time deposits classified as level 1 is based on the quoted market prices on the reporting date. Observable market data are used to measure the fair value of level 2 securities. For forward exchange contracts, we determine the fair value on the basis of the reference exchange rates of the European Central Bank prevailing at the reporting date, after allowing for forward premiums and discounts on the contracted exchange rate for the remaining term of the contract. Foreign exchange options are measured using price quotations or recognized models for the determination of option prices. We measure interest rate hedging instruments on the basis of discounted cash flows expected in the future, taking into account market interest rates applicable for the remaining term of the contracts. These are indicated for the two most important currencies in the following table. It shows the interest rates quoted on the interbank market on December 31 and September 30, respectively.

Interest rates in percent p. a.

As of	Euro		US dollar
December 31/September 30 Term	2015	2016	2015	2016
1 month	–0.21	–0.37	0.43	0.53
3 months	–0.13	–0.30	0.61	0.85
6 months	–0.04	–0.20	0.85	1.24
1 year	0.06	–0.06	1.18	1.55
2 years	–0.03	–0.22	1.18	1.01
5 years	0.33	–0.14	1.74	1.18
10 years	1.00	0.29	2.19	1.47

Due to the complexities involved, financial derivatives for hedging commodity price risks are primarily measured on the basis of simulation models derived from market quotations. Regular plausibility checks are performed in order to ensure correct measurement.

In measuring derivative financial instruments, counterparty credit risk is taken into account with an adjustment to the fair values concerned, determined on the basis of credit risk premiums.

Determination of the fair value of the contingent purchase price liability reported under other financial liabilities that resulted from our acquisition in Nigeria is classified as level 3. The fair value of the contingent purchase price liability on the date of the acquisition was 113 million euros. As a result of remeasurement as of September 30, 2016, this figure was adjusted to 69 million euros. The measurement effects were recognized directly in equity and reported in the statement of changes in equity as other changes in equity. The fair value was determined using the discounted cash flow method, taking into account the key financial figures of the acquired company based on a detailed planning horizon up to 2025. The discount rate applied derives from capital costs in euros. A further material valuation parameter – in addition to the long-term growth rate reflected in the perpetual annuity of 1.5 percent and the weighted average cost of capital (WACC) of 6.0 percent that was used as the discount rate – is the exchange rate of the Nigerian naira. An interest rate reduction combined with a depreciation of the naira would result in a lower negative fair value of the liability. An interest rate increase combined with an appreciation of the naira would result in a higher negative fair value of the liability.

Contingent liabilities

Effective September 30, 2016, liabilities under guarantee and warranty agreements totaled 12 million euros. On December 31, 2015, these liabilities amounted to 12 million euros.

Operating lease commitments

Operating leases as defined in IAS 17 comprise all forms of rights of use of assets, including rights of use arising from rent and leasehold agreements. Payment obligations under operating lease agreements are shown at the total amounts payable up to the earliest date of termination. The amounts shown are the nominal values. As of September 30, 2016, operating lease commitments were due for payment as follows:

Operating lease commitments

in million euros	Dec. 31, 2015	Sept. 30, 2016
Due in the following year	72	76
Due within 1 to 5 years	139	166
Due after 5 years	17	42
Total	228	284

Voting rights, related party disclosures

The company has been notified that, on December 17, 2015, the proportion of voting rights held by the members of the Henkel family share-pooling agreement represented in total a share of 61.02 percent of the voting rights (158,535,741 votes) in Henkel AG & Co. KGaA.

Notes to the Group segment report

There have been no changes in the basis by which the segments are classified or in the presentation of the segment results as compared to the annual financial statements of December 31, 2015. For definitions of net operating assets, capital employed and ROCE, please refer to our Annual Report 2015, pages 175 and 194.

Notes to the consolidated statement of cash flows

The main items of the consolidated statement of cash flows and the changes thereto are explained on page 31. The other changes in borrowings take into account a number of cash inflows and outflows, particularly from issuing and redeeming commercial paper and liabilities to banks. Of the dividend of 633 million euros paid to shareholders of Henkel AG & Co. KGaA, an amount of 377 million euros was paid on ordinary shares, while an amount of 256 million euros was paid on preferred shares.

Düsseldorf, November 3, 2016

Henkel Management AG, Personally Liable Partner of Henkel AG & Co. KGaA

Management Board Hans Van Bylen, Jan-Dirk Auris, Pascal Houdayer, Carsten Knobel, Kathrin Menges, Bruno Piacenza

Independent review report

To Henkel AG & Co. KGaA, Düsseldorf:

We have reviewed the condensed interim consolidated financial statements – comprising the consolidated statement of financial position, the consolidated statement of income, the consolidated statement of comprehensive income, the consolidated statement of changes in equity, the consolidated statement of cash flows, and selected notes – and the interim Group management report (pages 6 to 25) of Henkel AG & Co. KGaA, Düsseldorf, for the period from January 1, 2016 to September 30, 2016, which form part of the quarterly financial report according to Section 37w German Securities Trading Act (Wertpapierhandelsgesetz – WpHG).

The preparation of the condensed interim consolidated financial statements in accordance with those International Financial Reporting Standards (IFRS) applicable to interim financial reporting as adopted by the EU, and of the interim Group management report in accordance with the requirements of the German Securities Trading Act applicable to interim group management reports, is the responsibility of the Company's legal representatives. Our responsibility is to issue a report on the condensed interim consolidated financial statements and on the interim Group management report based on our review.

We conducted our review of the condensed interim consolidated financial statements and the interim Group management report in accordance with the German generally accepted standards for the review of financial statements promulgated by the Institut der Wirtschaftsprüfer (IDW) and in supplementary compliance with the International Standard on Review Engagements 2410 (ISRE 2410). Those standards require that we plan and perform the review so that we can preclude through critical evaluation, with a certain level of assurance, that the condensed interim consolidated financial statements have not been prepared, in material aspects, in accordance with the IFRS applicable to interim financial reporting as adopted by the EU, and that the interim Group management report has not been prepared, in material aspects, in accordance with the regulations of the German Securities Trading Act applicable to interim group management reports.

A review is limited primarily to inquiries of company employees and analytical assessments and therefore does not provide the assurance attainable in a financial statement audit. Since, in accordance with our engagement, we have not performed a financial statement audit, we cannot issue an auditor's report.

Based on our review, no matters have come to our attention that cause us to believe that the condensed interim consolidated financial statements have not been prepared, in material respects, in accordance with the IFRS applicable to interim financial reporting as adopted by the EU, or that the interim Group management report has not been prepared, in material respects, in accordance with the regulations of the German Securities Trading Act applicable to interim group management reports.

Düsseldorf, November 3, 2016

KPMG AG Wirtschaftsprüfungsgesellschaft

Prof. Dr. Kai C. Andrejewski Wirtschaftsprüfer (German Public Auditor)

Simone Fischer Wirtschaftsprüferin (German Public Auditor)

Report of the Audit Committee of the Supervisory Board

In the meeting of November 3, 2016, the interim consolidated financial report for the first nine months of fiscal 2016 and the report prepared by KPMG AG, Wirtschaftsprüfungsgesellschaft, on its review of the condensed interim consolidated financial statements and the interim Group management report were presented to the Audit Committee, who also received verbal explanations from the Management Board and KPMG pertaining to the above. The Audit Committee has approved and endorses the interim consolidated financial report.

Düsseldorf, November 3, 2016

Chairman of the Audit Committee Prof. Dr. Theo Siegert

Multi-year summary

Third quarter 2012 to 2016

in million euros	2012	2013	2014	2015	2016
Sales	4,294	4,184	4,236	4,590	4,748
Laundry & Home Care	1,194	1,167	1,188	1,314	1,479
Beauty Care	908	886	918	964	968
Adhesive Technologies	2,153	2,095	2,100	2,279	2,272
Adjusted1 operating profit (EBIT)	631	672	693	778	837
Adjusted1 earnings per preferred share in euros	0.97	1.10	1.17	1.30	1.42

1 Adjusted for one-time charges / gains and restructuring charges.

First nine months 2012 to 2016

in million euros	2012	2013	2014	2015	2016
Sales	12,508	12,503	12,302	13,715	13,858
Laundry & Home Care	3,448	3,531	3,474	3,926	4,157
Beauty Care	2,690	2,683	2,671	2,910	2,906
Adhesive Technologies	6,252	6,177	6,062	6,783	6,705
Adjusted1 operating profit (EBIT)	1,791	1,932	1,986	2,253	2,407
Adjusted1 earnings per preferred share in euros	2.78	3.13	3.37	3.77	4.09
1 Adjusted for one-time charges / gains and restructuring charges.

Contacts

Corporate Communications Phone:+49 (0) 211-797-35 33 Fax:+49 (0) 211-798-24 84 E-mail: [email protected]

Investor Relations Phone: +49 (0) 211-797-39 37 Fax: +49 (0) 211-798-28 63 E-mail: [email protected]

Credits

Published by: Henkel AG & Co. KGaA 40191 Düsseldorf, Germany Phone: +49 (0) 211-797-0

Edited by: Corporate Communications, Investor Relations, Corporate Accounting Coordination: Renata Casaro, Dr. Hannes Schollenberger, Wolfgang Zengerling Design and typesetting: MPM Corporate Communication Solutions, Mainz Photographs: Charles Cherney, Claudia Kempf, Steffen Hauser; Henkel English translation: Donnelley Language Solutions, London Pre-print proofing: Paul Knighton, Cambridge; Thomas Krause, Krefeld Printed by: Druckpartner, Essen

Date of publication of this Report: November 8, 2016

PR No.: 11 16 300

This quarterly and nine-month financial report is printed on LuxoArt Silk FSC. The paper is made from pulp bleached without chlorine. It has been certified and verified in accordance with the rules of the Forest Stewardship Council (FSC). The printing inks contain no heavy metals.

Except as otherwise noted, all marks used in this publication are trademarks and/ or registered trademarks of the Henkel Group in Germany and elsewhere.

Financial calendar

Publication of Report for Fiscal 2016: Thursday, February 23, 2017

Annual General Meeting Henkel AG & Co. KGaA 2017: Thursday, April 6, 2017

Publication of Report for the First Quarter 2017: Thursday, Mai 11, 2017

Publication of Report for the Second Quarter 2017 /Half Year 2017: Thursday, August 10, 2017

Publication of Report for the Third Quarter 2017 /Nine Months 2017: Tuesday, November 14, 2017

Up-to-date facts and figures on Henkel also available on the internet: www.henkel.com

This document contains forward-looking statements which are based on the current estimates and assumptions made by the corporate management of Henkel AG & Co. KGaA. Forward-looking statements are characterized by the use of words such as expect, intend, plan, predict, assume, believe, estimate, anticipate, forecast and similar formulations. Such statements are not to be understood as in any way guaranteeing that those expectations will turn out to be accurate. Future performance and the results actually achieved by Henkel AG & Co. KGaA and its affiliated companies depend on a number of risks and uncertainties and may therefore differ materially from forward-looking statements. Many of these factors are outside Henkel's control and cannot be accurately estimated in advance, such as the future economic environment and the actions of competitors and others involved in the marketplace. Henkel neither plans nor undertakes to update forward-looking statements. This document has been issued for information purposes only and is not intended to constitute an investment advice or an offer to sell securities, or a solicitation of an offer to buy securities.

Our quarterly financial reports are also published in the Henkel app.

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Henkel AG & Co. KGaA 40191 Düsseldorf, Germany Phone: +49 (0) 211-797-0 www.henkel.com

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Henkel AG & Co. KGaA

207_10-q_2016-11-08_1f0a3b08-8857-4a1b-ad00-6d1aa2255bc9.pdf

Henkel: Financial highlights

Contents

Highlights third quarter 2016

Key financials

Key facts

Major events

Share performance

Key data on Henkel shares, third quarter

Performance of Henkel shares versus market third quarter 2016

Performance of Henkel shares versus market January through September 2016

Report third quarter 2016

Business performance third quarter 2016

Key financials 1

Results of operations

Reconciliation from sales to adjusted operating profit1

Regional performance

Key figures by region 1 third quarter 2016

Key figures by region 1 first nine months 2016

Laundry & Home Care

Key financials 1

Sales development1

Bref Power Aktiv

Beauty Care

Key financials 1

Sales development1

Innovation

Fa Dry Protect

Numerous innovations strengthened our businesses:

Adhesive Technologies

Key financials 1

Sales development1

Bonderite solutions for Metal Packaging

Financial report January through September 2016

Underlying economic conditions

Sectors of importance for Henkel

Effects on Henkel

Business performance January through September 2016

Key financials 1

Results of operations

Sales development1

Price and volume effects first nine months 2016

Guidance versus performance 2016

Comparison between actual business performance and guidance

Net assets

Financial position

Capital expenditures

Acquisitions and divestments

Subsequent events

Employees

Research and development

Outlook

Opportunities and risks

Outlook for the Henkel Group in 2016

Interim consolidated financial statements

Consolidated statement of financial position

Assets

Consolidated statement of income

Additional voluntary information

Consolidated statement of income

Additional voluntary information

Consolidated statement of comprehensive income

Consolidated statement of changes in equity

Consolidated statement of cash flows

Additional voluntary information Reconciliation to free cash flow

Selected explanatory notes

Group segment report by business unit1

Group segment report by business unit1

Reconciliation of adjusted net income

Adjusted net income third quarter

Adjusted net income first nine months

Earnings per share

Earnings per share

Changes in treasury shares

Recognition and measurement methods

Scope of consolidation

Material acquisitions and divestments

Acquisitions