Henkel to step up investments through 2020 to boost profits

FRANKFURT (Reuters) - German consumer goods group Henkel will step up its spending in the coming years to strengthen its top brands, grow in emerging markets and try to boost profits.

Henkel's new Chief Executive Hans van Bylen, who took over in May, said the group would invest as much as 3 billion euros ($3.2 billion) in the four years through 2020, up from around 2 billion for the 2013 to 2016 period.

Henkel will seek to enter new markets, including through acquisitions, and get new products on to store shelves more quickly.

At the same time, the share of sales generated by Henkel's top 10 brands, which include Persil laundry detergent and Schwarzkopf beauty line products, is to grow to 75 percent by 2020 from 61 percent in 2015, Henkel said.

The group aims for average annual growth of adjusted earnings per preferred share of 7 to 9 percent through 2020, it said, which compares with a 2016 aim for 8 to 11 percent.

Henkel last week reported third quarter results that beat consensus, helped by growing demand in emerging markets.

Initial market reaction to the latest targets was cool.

Shares in Henkel fell 1.8 percent to a four-month low of 107.25 euros in early trade, making them the second-biggest decliners on Germany's blue-chip index.

($1 = 0.9351 euros)

(Reporting by Tina Bellon; Editing by Edward Taylor)