Dear shareholders and representatives, dear media representatives and dear followers who are following our livestream on the Internet. I would like to open this year's Annual General Meeting of Henkel AG and Kokei GAA, and I would like welcome you on behalf of the Supervisory Board, the Shareholder Committee and the Management Board. Like in previous years, we would have preferred to actually welcome you in Dusseldorf Congress Center with a personal attendance meeting. But as you know, due to the corona pandemic and the requirements, the statutory requirements, it is not permitted to organize large scale events. Consequently, we had to cancel our AGM, which we had scheduled for the 20th April, to which we had invited you in early March because Henkel attaches the utmost importance to the health and safety of its employees, shareholders and any service providers involved.
Nevertheless, we wanted to conduct the AGM in a timely manner to adopt our resolutions. Therefore, the management shareholders and their authorized proxy holders. This is a possibility granted by the COVID Mitigation Act. The conventional period of invitation of 30 years was complied with, and we therefore invited you to an AGM in a virtual AGM. The invitation was announced in the Federal Gazette on 6th May 2020, and the invitation was disseminated by the media on the same day and published on the corporation's website.
The required notifications, in particular to credit institutions and shareholder associations, to be forwarded to our shareholders have been sent out in due time. As a company with treasury shares, we cannot have direct contact with our shareholders. We need a multistage procedure to reach out between the corporation, the custodian banks, the shareholders and the service providers. With a bridge to lead times, it would not have been possible to rule out the possibility that U. S.
Shareholders would have received the documents required for this AGM with a delay. We wanted to prevent this. Therefore, we did not use the option granted by the COVID Mitigation Act to cut short any invitation periods for the convocation of the AGM. I, therefore, would like to state that we have issued a convocation to this AGM in line with the statutory requirements and our articles of association. Ladies and gentlemen, as I mentioned, we are convening a virtual AGM, which means without the physical attendance of our shareholders or their proxy holders.
Voting rights can therefore be only exercised in writing, and it is still possible to cast votes through the Henkel investor portal until we start voting. This is the best way to ensure the health and safety of all parties involved. Aside from myself, we have Mrs. Helton Kindlein from the Supervisory Board. She is the Deputy Chairwoman.
And Professor Siegent as the Chairman of the Audit Committee and Chairman of this meeting, who has been elected by the shareholder committee. We represent the Supervisory Board. The Management Board is represented by Mr. Knobel as the Chairman of the Management Board and Mr. Svoboda as the Chief Financial Officer.
All the other members of the Supervisory Board and the Management Board and the members of this shareholder committee are also logged on and can follow the audio and video stream. We also have Professor Doctor. Zimmermann, our notary, present here on these premises. He will also write the minutes. He has the documents on the convocation of this AGM, which was published in the present in person.
Ladies and gentlemen, of course, we are well aware that this format of a virtual AGM also imposes considerable Usually, you're able to ask questions during the meeting. But this way, we make it possible for shareholders or their representatives to submit any questions through the investor portal. 9 shareholders or their proxy holders have posed 56 questions on the whole, which is actually right the average of what we had in previous years. Following the presentation of Mr. Knobel and my explanations on the activities of the supervisory, we will elaborate on today's agenda and the special items.
And afterwards, I will also explain our voting to change any instructions to the proxy holders. I will also announce when we are going to close the Henkel Investor portal. We will then start with the voting process, and it will be carried out by the proxy holders appointed by the corporation. Any votes cast by mail will be added to the votes cast by the proxyholders. Once we have a voting result, I will actually state and announce this voting result.
Like in previous years, we will also transmit the speech of the CEO for the shareholders and also the general public. Any shareholders or proxy holders are able to follow the proceedings through the investor portal. Likewise, accredited media been submitted. Any objections against resolutions of the AGM can actually be submitted to our notary until the end of this AGM through the Henkel investor portal. I would like to ask you for your understanding for these restrictions, which are imposed by such a virtual AGM.
Ladies and gentlemen, regarding the composition of the supervisory and management board, we have had the following changes. As already reported last year, Catherine Magness left the Management Board by mutual agreement. She was replaced by Sivinikl, effective as of 9th of April 2019 as management board member. She is responsible for human resources and infrastructure services. The appointment of Mr.
Van Beilen as Chairman and Member of the Management Board was terminated by mutual agreement effective on December 31, 2019, after around 35 years in the company, of which he spent around 15 years on Hans Van Beilen was no longer available for another term of office. Under Hans von Bayern's leadership, all business units were further strengthened through acquisitions and partnerships. I would like to thank him on behalf of all our corporate bodies for his major call setting influence during this time as Chairman of the Management Board and for his commitment to our 35 years. Effective from 1st January 2020, Mr. Knobel was appointed as new Chairman of the Management Board.
He has been a member of the Management Board since 1 July, twenty 12, and used to be the Chief Financial Officer before. He has been in the company for 25 years, and he had various management positions in various functions, both in Germany and abroad. I'm confident I'm very pleased that we have found an excellent successor for the Chairman of the Management Board with Mr. Knobel, and I'm confident that Henkel will continue to prosper under his leadership and management. Effective also as from 1st January 2020, Mr.
Sohrabar was appointed to succeed Carsten Knobel as Chief Financial Officer. He started his career at Henkel back in 1997 after various managerial positions in financial controlling. He took the additional responsibility for the corporate planning activities between 2011 2014. He was the head of our financial organization in the Asia Pacific region based in Shanghai. And he then returned to his office in Dusseldorf for Global Financial Organization.
And we wish both Castenk Global and Marcus Voboda every success in their new roles. Ladies and gentlemen, we also will see other changes in our executive bodies in the supervisory board and in the management board. We have actually attached the CVs of the proposed candidates to the convocation and the invitation of this meeting. A few words about the details. Professor Siegert and Doctor.
Von Braun will also resign from their offices after this AGM. As you can see under item 7 of this agenda, we propose to elect Mrs. Mene and Mr. Borenberg to the Supervisory Board. All the other members are proposed for reelection.
Now regarding the shareholder committee, Mr. Wenning will resign from their positions after this ATM. Under Agenda Item 8, we proposed Mr. Birken and Doctor. Knab as new members, and the remaining members are proposed for reelection.
These new candidates are in line with our aim to rejuvenate our executive bodies, to boost diversity and to strengthen our competence in key areas such as digitization. I'm very pleased that we were able to propose excellent candidates for these positions. As the candidates cannot be present in person, I would like to briefly introduce you to them. On the Supervisory Board, Mrs. Mena was born in 1960 in Kiel.
She is actually a recognized expert in the field of finance and accounting, and we were very pleased to get her for the supervisory board. She was a CFO at Lufthansa and Boehringer Ingelheim, and she has years of management expertise. And she has also been a member of various supervisory bodies of German and International Companies. In case she is elected, Mrs. Mene will also be a member of our Audit Committee.
When Professor Siegert will leave the Audit Committee, Professor Kaske, who is a very experienced member, will become the Chairman. So in future, we will then have an independent financial expert in line with the requirements of our Stock Corporation Act, and her Bolinberg was born in 1973 in Dusseldorf, Mr. Bolinberg was born in 1973 in Dusseldorf. He also has a commercial background and is a businessman himself. He's an investor in innovative startups and young companies, and he thus contributes this valuable expertise to our company.
He's a member of the Henkel family and has had close ties with the company for many years. Now regarding the shareholder committee. Mr. Birken, born in 1964 in Hamburg, is an economist and Chairman of the Management Board of OTO Group, an international trading company and service provider with more than 50,000 employees and a turnover of more than €40,000,000,000 With an online turnover of almost €8,000,000,000 the OTO Group is one of the biggest online retailers worldwide. Since topics like digitization and online retail are also in Henkel's own focus, this is an expertise which Mr.
Birken can contribute to this strategic key area. Doctor. Knipe, who was born in 19 62 in Zerklingen, is a tax adviser and consultant at Worth and Klein Grant Thornton. He can also be considered a member of Henkel family and has been had close ties with the company. With his expertise and experience in any tax matters of a national and international nature, Doctor.
Knabe will also contribute valuable expertise and competence to the shareholder committee. At this point, I should like to thank all members who are going to resign from the supervisory board and the shareholder committee, and I would like to thank them for their commitment in the interest of the company. A particular gratitude goes to Professor Siegert, who has been a member of the Supervisory Board since 2,009 and has been has had considerable expertise with which he chaired the Audit Committee. Mr. Wenning, who has been a member of the shareholder committee since 2,008 and the supervisory board of Henkel Management AAT since 2013.
I would like to thank Mr. Wenning for his commitment and his valuable contributions to the discussions. At the same time, I would like to cordially thank the members of the executive bodies of the Henkel family who are going to resign, Kasper von Braun and Stefan Hammelmann, for their appreciated, committed and years of membership and dedication. Ladies and gentlemen, so much about the new elections to the Supervisory Board and Shareholder Committee. Before we get down to the agenda, I'd like to make a few housekeeping announcements.
Any information on the organizational proceedings of this virtual AGM are contained in an information leaflet, which has been available on our Web site since we published a convocation to the AGM. I would like to repeat the most important points. When you you receive an admission card with a code that entitles you to follow the proceedings on the Henkel Investor portal. As owners of ordinary shares, you can exercise your voting rights through the Investor Portal either by mail or by giving authorization or instructions to the proxy holders. This will be possible until we start with the voting process, and I will point out when we will do this.
In case you have several admission cards, you have to type in the corresponding admission code for each of these cards because this is the only way to give full consideration to your votes. Please bear in mind that this may take some time. And if you haven't cast your vote, please try to cast your vote as early as possible. We also have an attendance record for the virtual AGM, too. Before we start, I would like to announce attendance as follows.
Through proxy holders and instructions, we have ordinary shares represented 233,134,331,131 with the same number of votes. And the preferred number of preferred shares is 11,822,786 without voting rights in line with Article 129 of the Stock Corporation, which represents $55,93,000,000 of our capital stock. We also have written votes for or mail votes for or followers are watching these proceedings. So the number of followers may actually change depending on any authorizations on any authorizations or instructions or also the revocation of any instructions or authorizations granted. Therefore, we will continuously update it.
I will give you the actual number of followers when I will announce the voting results. So much on the formalities, ladies and gentlemen. We will now start with the agenda. I would like to point out that regarding agenda items 12, the following documents were available on our website: the annual financial statement of the single company and the group the consolidated management report for the single entity and the group, including the report on corporate governance and the remuneration report as well as the disclosures in line with Section 289A, Subsection 1 and Section 315A, Subsection 1 of the German Commercial Code, the proposal for the adoption of the annual financial statements and appropriation of the profit and the report of the supervisory board for fiscal 2019. Any other documents relevant for this AGM have also been available on the Internet.
This pertains to our sustainability report, which also contains a non financial declaration. As you can see on our agenda, we have the usual items on the agenda like but in addition to that, we have the new election to the Supervisory Board and the Shareholder Committee, but also the resolution on adopting a new system remuneration system for the management board, the resolution on creating new authorized capital against cash contribution with subscription rights and result in changes of our articles of association and the resolution on an amendment to Article 20, Section 2 of our articles of association. Ladies and gentlemen, Mr. Knobel will now present his report on fiscal 2019 and report on any other matters pertaining to the company. Mr.
Klobel, you have the floor.
Ladies and gentlemen, guests and dear friends of the Henkel Group, I'd like to extend a warm welcome to our Annual General Meeting on behalf of the management board and our employees around the world. Today, we're conducting our Annual General Meeting online, and that's a first in the history of Henkel. It's an unusual format, but it's a necessity due to the threat of the coronavirus. As Ms. Bajel explained in detail in the opening address, I hope you can follow the event without difficulty, and I also thank you for your understanding.
The current crisis marks a deep cutting point with wide ranging changes. The crisis is forcing us to view many things from a different angle. People also adopted a new view in 1969 with the landing on the moon, But people were fascinated by those images from outer space, pictures showing planet Earth seen from the moon. This brought us a new perspective, too. It changed our attitude and our behavior for each and every one of us and also for society.
I'm perfectly aware that these two events are completely different. The landing on the moon wasn't just planned very long ahead. It was a great event, but the current pandemic is a terrible disaster for all of us. I believe that the current crisis is set to greatly change the way we think and act much more than we can foresee today. Our lives have fundamentally changed in the last few months within our families, within our groups of friends and in society and of course, also within the economy and companies all over the world.
I'd like now to briefly outline to you how we have dealt with the current challenges so far. Since the outbreak of infections, our crisis teams have been constantly at work in all the countries and regions concerned. Also here at our headquarters in Dusseldorf, we responded quickly determinedly to protect our employees around the world. Their safety and their well-being are of utmost importance for us. They're a top priority.
We've taken comprehensive precautions for their protection at our sites. And wherever possible, our staff are working from home around the world. Having said that, there's a number of Henkel employees who fall in sick. Currently, the figure is about 100. We're in close contact with them and their families.
I send all colleagues affected my very best wishes and to recover in full. We have a long tradition as a family business. We're committed to our social responsibility, which is why we're making a contribution to fight this global crisis. We launched a global solidarity program in March. This includes financial support.
For example, €1,000,000 for the COVID-nineteen Solidarity Response Fund of the WHO. This is being used to purchase PPA and support intensive care units. This also supports research into possible vaccines and drug treatments. We further donated 5,000,000 products for personal household hygiene, and we're producing disinfectants outside sites. In Dusseldorf, we've donated more than 50,000 liters to the health authority and also to hospitals in the city and surroundings.
Nikolay Perna and his team have converted an adhesive production line for this purpose. In Algeria, our colleagues, Maja Hafiz and Nai Loziani, have also launched a great initiative. There, Hecla has been engaged in disinfecting public spaces and facilities in 6 major cities with a total population of about 8,000,000. And we've also donated 50,000 liters for disinfection in hospitals. This is just two cases in point of the great commitment of our employees.
Despite the crisis, we've succeeded in keeping our businesses operational for our customers throughout the world in retail and in industry. So far, we've been able to maintain production at most locations worldwide. This is also great achievement of our employees under difficult circumstances. They've earned our gratitude for this. We owe them our respect.
We're now a short time working, no furlough in the Q1. We also don't want to cut any jobs due to the corona crisis, and we don't see any reason for this even now. We're continuing to hire employees, and we're also continuing our apprenticeship program. This autumn, another training year will begin here in Dusseldorf in the same scope as last year, and that's very much something that's close to my heart because we must invest in the next generation and fulfill our responsibility as a corporate citizen. That's one specific example of how we're doing it.
I'm quite proud to see how our colleagues around the world are dealing with this particular challenge. They're applying entrepreneurial spirit, courage, creativity. They're demonstrating what we all stand for, shared values and a strong, vital corporate culture. And that's what makes Henkel so special: accepting challenges and standing together as a team, responding flexibly, finding new ways, acting with speed and courage, taking ownership. That's our commitment.
That's my commitment. As the Chairman of the Management Board, I want to both lead and encourage such attitudes. Despite all the current uncertainty, I am rather confident as a person. Every generation of people at Henkel, the Henkelana, as we're saying them, has had major challenges and crisis to contend with. And I'm convinced that together we're strong to tackle this challenge, too.
Ladies and gentlemen, I accepted the capacity as Chairman of the Management Board at the beginning of the year. At the time of taking office, I could never have imagined that the year would develop as it has. I've now been with Henkel for 25 years, then of 8 as a CFO. During this time, Henkel has become, for me, much more than just my professional home. Even today, the company still fascinates me.
It's intriguing with its diversity, with its dedicated staff, with its history, culture and values. But Henkel also stands for so many innovations and brands. They're an integral part of the lives of millions of customers and consumers worldwide. In their households, their kitchens, their bathrooms and their kids' rooms, in cars and planes and in trains, not to mention mobile phones, computers and TV screens, with our contributions for more sustainability and our social commitment. I am proud to now be leading Henkel into the future, together with my colleagues on the management board and with so much support from 52,000 Henkel employees around the world.
Therefore, I once again like to say thank you today for the honor you're giving me as I can lead Henkel as its CEO and for the trust that you're placing in me. In particular, I'd like to thank you, Doctor. Bujel Chartres, but also all the members of our corporate bodies and of course, the Henkel family and you, our shareholders. Today, I'd like to address 2 major topics. Of course, the report for fiscal 2019 is on the agenda.
We've already published the results at the beginning of March, but it's particularly important for me to look ahead into our future. 1st, I'll explain Henkel's performance in the past fiscal year. In 2019, our businesses were affected by various developments in our markets. Almost all national economies recorded weaker growth. There were increasing trade tensions between the U.
S. And China. There was uncertainty relating to the U. K. Exit from the EU, and there were geopolitical conflicts in various regions.
Within such an environment, our business has developed in various ways. In our Adhesives business, we faced a significant slowdown in key customer segments. This was particularly true for the automotive sector and the electronics industry. At the same time, our consumer business faced intense competition in many markets, and that impacted our Beauty Care and Modern Home Care business units. As I said when announcing our results at the beginning of March, we had expected developments in our markets to be significantly better, but we had to adjust our expectations several times during the year.
Even though there were clear reasons for this, this can't be what we expect from ourselves. We must and want to do better again in future. Notwithstanding, we've achieved a lot in 2019. We increased sales by around 1% to more than €20,000,000,000 We achieved a margin of 16%. We generated free cash flow to the tune of almost EUR 2,500,000,000 That's a new all time high for Henkel.
We had a low level of debt at year end, and we strengthened our businesses through acquisitions during the year. At the same time keeping costs well under control. We owe all these achievements to the commitment of our employees, and that's why I'd like to extend my thanks to them. I'd like to thank you on behalf of the entire management board and certainly also on your behalf to shareholders. I shall now present the business results for 2019 in more detail.
In nominal terms, sales rose by 1.1 percent to €20,100,000,000 Organically, sales development remained flat. That is exclusive of the effects of currency effects, acquisitions and divestments. Adjusted operating profit amounted to €3,200,000,000 That's a decline by 7.9%. Adjusted return on sales amounted to 16.8%, which is 1.6 percentage points less year on year. The main reason for this was increased investment.
Here, we earmarked an additional spend of €300,000,000 to strengthen our brands, innovations and technologies, particularly in our consumer goods business as well as for the digitalization of Henkel in all areas across the board. In total, we'd spent around €150,000,000 or more on this by the end of the year. So just half of the additional investment earmarked originally. Adjusted earnings per preferred share were at €5.43 That's a decline by 9.7 percent over the previous year. Our free cash flow developed quite positively.
It rose to around €2,500,000,000 That's a new record. This meant we're also able to further reduce our net debt. As of year end, it amounted to around €2,000,000,000 We recorded good growth in the emerging markets in 2019 with a rise of 2.5%. This made them the main drivers of our organic sales development. Sales there amounted to approximately €8,100,000,000 That's tantamount to 40% of our group sales.
Sales in mature markets amounted to €11,700,000,000 slightly below the previous year's figure. Let's now have a look at our 3 business units. Adhesive Technologies is our biggest business unit, generating around half of our total sales and half of our earnings. We're the world market leader in this business. We have a global footprint, and we have all the technologies, which makes us a strong partner for customers in many different industries.
As consumers, we all rely on our technologies every day. And often, we don't even know that we do. With our innovations, we make food packaging safer. Mobile phones and computers are made more powerful. We're making cars lighter, and we're enabling e mobility.
We make our data networks faster, and we help to better insulate buildings. Our products are also used in medicine. You see, our adhesive solutions can be found almost everywhere. For many of our customers in industry, however, 2019 wasn't an easy year. We saw a weakening of growth in key segments.
Nevertheless, together with our partners and suppliers, we developed innovative solutions enabling us to further advance our businesses. So we recorded increased sales with applications for the aerospace Our business with metal packaging products also grew. However, this only partially offset the decline in global automotive production. Sales with the electronics industry also declined. By contrast, we achieved higher sales growth with Adhesive Products for consumers, craftsmen and building.
Overall, sales of Adhesive Technologies amounted to around €9,500,000,000 which in nominal terms is 0.6% more over the previous year. However, our organic sales development showed a slight decrease to the tune of 1.5%. Adjusted return on sales amounted to 18.1%. That means that Adhesive Technologies made an above average contribution to Henkel's profitability. Let us now take a look at Beauty Care, our experts for 2 Beauty.
We were not satisfied with the overall business development of Beauty Care in 2019. Sales amounted to €3,900,000,000 That's a decrease by 1.8%. Organic sales development declined by 2.1%. At Beauty Care, we have 2 major business areas, performance varied here. In the professional business serving hair salons, we achieved sales of more than €1,000,000,000 That's more than a quarter of our Beauty Care business.
This business field was very successful in 2019, posting strong organic sales growth. At this point, I'd like to address our hairdressers in particular. They're an important customer group for us. The current crisis has hit you hard. We'll continue to support you, and we'll remain by your side as a true partner you can rely on.
The second business area is that of branded consumer goods. That includes hair care, hair styling and coloration, especially under our top brand, Schwarzkopf, but also body, skin and oral care. Sales of this business area amounted to around €3,000,000,000 In organic terms, that's a decline over the previous year, which was chiefly due to the negative trend in Western Europe and Asia. But I'd also like to highlight the successful development of our global brands, Got2b and Palette as well as our Nature Brands, NatureBox and NAE. This is particularly important to me because their success is linked to important trends such as sustainability.
Adjusted return on sales achieved 13.4%. This was significantly lower than the previous year, and it was mainly due to declining gross margin and increased investments in brands, technologies and digitalization. We now come to the 3rd business unit, Laundry and Home Care. With its many traditional innovative and successful brands, from Persil and Pril to Orlin Somat. Just to quote a few examples.
Here, we recorded very good performance in 2019. Sales grew organically by 3.7%. Reported sales also increased year on year by 3.7%. This business unit also consists of 2 business areas. The Laundry Care business area recorded good sales growth in 2019 with our brand icon, Purcell, making the strongest contribution.
Purcell is Henkel's best known brand. It's a success story. Ever since its launch 113 years ago, it is the premium laundry detergent in the world. In 2019, we generated annual sales of €1,300,000,000 with Persil. The 2nd business area in this field is Home Care.
This grew strongly last year. The biggest contributions came from our hand dishwashing and our toilet cleaning products from brands such as Pril and Breff. Adjusted returns on sales amounted to 16.5%. That is a decrease over the previous year. Here again, the most important reason was the increased investment already mentioned.
So much for Henkel's business performance in fiscal 2019.
Did not achieve everything we wanted. This was due to the difficult market environment and also to some extent to ourselves. Today, we would like to propose to you a dividend of €1.85 per preferred share. For the ordinary shares, it is €1.83 This corresponds to the level of the previous year and means that we have raised the payout ratio. It amounts to 34.2%, which is 3.3 percentage points higher than in the previous year, and it is thus also within the targeted range between 30% 40%.
At year end 2019, the price of the Henkel preferred shares closed below the level of the previous year by minus 3.4%. In contrast, the DAX index grew year on year by 25.5%. This performance of our shares is disappointing, particularly for you as our shareholders, but also for us as management. There is nothing to gloss over. It is something we want to change.
This is why we are looking ahead, which brings me to the 2nd major topic for today, our future. This decade should be a success for Henkel, a decade in which we set the course for Henkel's future with successful innovations for our customers and consumers, a decade in which we make our business even more competitive, further increase our sustainable development, rigorously drive forward digitalization in all areas, become even more efficient and faster and further develop our corporate culture. We want to grow with a holistic approach because growth for us involves a number of different aspects, creating value for our customers and consumers so that we grow more strongly than our markets extending our leadership in sustainability and empowering our people to constantly develop within Henkel professionally and personally. That is our agenda for purposeful growth. That is my commitment because I'm convinced we can be successful if we achieve purposeful, sustainable growth.
This is what you should judge us by. We have developed a clear strategic framework for this. This includes a successful portfolio clear competitive edge, particularly in the areas of innovation, sustainability and digital future ready operating models and new business models and a strong corporate culture. I would now like to explain the individual elements in greater detail to you. We want to comprehensively optimize our portfolio in the consumer business.
This is an area in which we must act. Therefore, we will divest brands or categories that do not hold a leading position or if we foresee only little possibility for growth. So we will be focusing on active portfolio management. We've already been doing this in our industrial business in recent years with success. We have identified brands and categories with a total sales volume of more than €1,000,000,000 By 2021, we will divest around €500,000,000 in sales, and we will bring the other brands and categories back on track to success.
Acquisitions remain an integral part of our strategy also in the future, always subject to clearly defined criteria: availability, strategic fit, financial attractiveness. This brings me to the 2nd pillar of our strategy, strengthening our competitiveness. For this, we are focusing on 3 main areas: innovation, sustainability and digitalization. Innovative brands and technologies are key, which is why we will invest more in this field. For this, we will be breaking new ground, for example, through the increased use of data and with the help of digital analysis.
This will bring us many advantages, better insights into consumer behavior, the ability to identify trends at an earlier stage and to respond to these with new products. We will open ourselves up more with investments in incubators and innovation centers and with an eye on open innovation platforms. This will give us new impulses and impetus. We also intend to continue pursuing direct investments or collaboration with technology startups with our venture capital activities. I'll give you 3 specific examples of this.
1st, sustainable product innovations. We have acquired a stake in the cleaning products manufacturer, Truemans. This U. S. Start up specializes in innovative cleaning products.
It only uses refillable bottles and refill cartridges containing highly concentrated detergents. This reduces plastics consumption, making a valuable contribution to more sustainability. 2nd, new digital business models. We have invested in the start up YOU. This young company develops new brands for attractive target groups and markets these on its own digital platform and on social media.
3rd, an example from our industrial business. Here, we've invested in a start up that specializes in recycling solutions. The company is called SaparaTech. Together, we are developing recyclable adhesives. This will also enable flexible packaging to be recycled, particularly in the food industry.
We are also consistently supporting our innovations and brands through higher investments. From this year on, we will be increasing our growth investments by €350,000,000 versus 2018. A considerable portion of this will be channeled into innovations, advertising and marketing. The other portion will go into the digitalization of our businesses and into IT. More on this in just a moment.
First, I would like to explain how important the topic of sustainability is for us and also for me personally. We all have changed over the years. My views, too, have evolved on many issues, particularly through the engagement of so many young people: climate protection, less plastic waste, sustainable consumption, these are the issues that concern us today and are uppermost in our minds, and rightly so, in my opinion, because we only have this one planet. So we must act. Sustainable management is one of Henkel's great strengths.
We have a leading role to play here for a long time now. Our pioneering role is regularly confirmed in ratings and rankings, which is why we aim to further strengthen sustainability as a clear competitive edge. For this, we have defined the next milestones and specific targets. For instance, with regard to climate protection, by 2,040, Henkel will become climate positive. By 2025, we will reduce the carbon footprint of our production by 65% compared to the base year 2010.
And we expect to save €100,000,000 in terms of CO2 together with our consumers, customers and suppliers. And in the avoidance of plastic waste, by 2025, 100% of Beauty Care and Laundry and Home Care packaging will be recyclable or reusable, and these are just a few examples. Sustainability will be anchored in all our business activities. It will become a central pillar in our innovation strategy. We are developing sustainable brands and products for our customers and consumers.
And with this, we are making our company future ready, fit for the future. We also want to create a clear competitive edge through the digitalization of our businesses and through the expansion of new digital business models. In doing so, we will align ourselves to the digital megatrends, the growing importance of the platform economy, the changes in consumer and customer behavior and the transition to new service models in the industrial business. All these topics will change our businesses fundamentally. We see great opportunities arising from this, which is why we are launching corresponding projects and initiatives.
We are expanding our digital channels. We will be intensifying interaction with our customers and consumers by extending existing digital platforms and offering for consumers and also establishing new models. In the adhesives business, we are developing new applications, especially tailored to our industrial customers. Digitalization enables us to respond more rapidly and to produce more efficiently, and here, we are also scaling artificial intelligence. But we also need the right people, the right employees for this.
That is why we intend to invest even more in digital talent, for example, in data scientists and software engineers. We've already begun with the first organizational changes in recent months to strengthen the digital business focus and enable greater efficiency. We have named the new division Digital Business. There, on the one hand, we are working on the ongoing optimization of business processes along our value chain to ensure high performance, efficient and future ready IT capability. On the other hand, this unit is responsible for digital business ideas and innovations.
Here, we plan to establish new digital innovation hubs in Berlin, in Silicon Valley and in Asia. With our focus on innovation, sustainability and digitalization, we are making Henkel even more competitive and are positioning our company for purposeful growth. That brings me to the 3rd element of our strategic framework, lean, fast and future ready business processes. Business processes and structures require regular review. Are they still up to date?
Are they sufficiently lean, fast and simple? We will also be developing new business models with a focus on ensuring close proximity to our customers and consumers. Decision making will be accelerated. We are also striving to constantly increase efficiencies in all areas. I've now described 3 important elements of our strategic framework: successfully shape our portfolio create a clear competitive edge, establish lean operating processes and future ready business models.
These are big challenges, and we need motivated, committed employees to meet them, united by a strong corporate culture, by shared values and a clear understanding for teamwork and collaboration. That is the 4th element of our strategic framework, and it is one that is particularly close to my heart. I've now been with Henkel, our for our culture. I have now been with Henkel for 25 years. I know how important values, culture and team spirit are in our company, especially today in difficult times when we are facing major challenges.
That is why it's important to me that we continue to further develop our culture to strengthen it, to convey what contribution each employee can make to it. We have introduced new leadership commitments. They apply to all employees at all levels, irrespective of hierarchy. And now the time has come to further extend these commitments to firmly anchor them in the minds of all employees. With this, we intend to drive cultural change towards a culture of cooperation with more creative freedom for our employees.
It's also very important for us that our employees constantly develop so that they can grow both professionally and personally. We therefore specifically promote their training, particularly in areas that are relevant for the future, for example, in the areas of digitalization and collaboration. At this point, I would like to address another important issue, the promotion of diversity and mutual respect for one another. Henkel is a global company. Our employees come from more than 100 nations from all cultural backgrounds.
We need this diversity. It helps us to be successful, which is why we consciously promote diversity in all dimensions. For us, it is the individual who counts with his or her experience, their knowledge and their ability to contribute, not gender or age, skin color, nationality, sexual orientation or political leanings. This should all go without saying, yet it still needs to be emphasized time and again. Discrimination and racism are unacceptable.
We embrace diversity. We are committed to diversity, and this too feeds into our corporate culture. Ladies and gentlemen, this decade is going to be the decade for Henkel, with purposeful growth driven by innovation, sustainability and digitalization. At this point, I would like to show you a short film because pictures express much better what characterizes us, who we are, what we stand for and how we are shaping our future. You see the power that lies within Henkel, what drives us, who we are, where we want to be in the future.
This is also reflected in our financial ambition. Over the medium and long term, we aim to generate organic sales growth between 2% and 4% and growth of adjusted earnings per preferred share in the mid- to high single digit percentage range at constant exchange rates with our focus on free cash flow expansion. The underlying economic environment has changed fundamentally for the current year. We are seeing demand collapsing across many branches of industry as well as rapidly rising unemployment in many countries. This is also impacting our businesses.
In the Q1, we recorded robust sales performance overall. Nominally, group sales decreased slightly to €4,900,000,000 a decrease of 0.8%. Organic sales showed only a slight decline of 0.9% year on year in spite of the effects of the COVID-nineteen pandemic. In all, we registered a decrease in sales of about €100,000,000 in the first quarter has not yet closed, but it is clear that it will be a tough quarter because lockdown took place in many countries during this period. There will be more on this at the beginning of August when we present our half year results.
We are currently unable to realistically assess how the year will develop overall. Therefore, we withdrew our existing guidance for the year in April. We will publish a new forecast as soon as this is possible. One thing is certain, however, we will need to constantly adapt as the crisis evolves. At the beginning, I was talking about the landing on the moon and how it changed our view of things.
The corona crisis will also change our perspectives in the long term. We will see the world with different eyes. Our behavior will change. We will react flexibly and quickly to the upheavals in our markets, actively shape change and break new ground. Our foundations are sound.
We have seen this in the current crisis, and this is something we will build on in the future. We have a diversified portfolio with 3 business units. We stand for successful brands and innovations with leading positions in various markets around the world. We have a very healthy balance sheet and a high level of financial flexibility. Our low net debt and the strong A rating give us very good financing options.
Above all, we have exceptional dedicated employees with shared values, and we are pursuing a future oriented strategy. We are well positioned, and we will emerge stronger from the crisis. We are pursuing a clear agenda for the future for purposeful growth. We create sustainable value for our customers, our employees, for you, our shareholders and for society at large. To end, please allow me to once again express my thanks to my colleagues on the management board for your team spirit, for your outstanding commitment to our company, to our corporate bodies, for your valuable support, for your advice and counsel and for our constructive talks regarding the future of our company and of course, to you, our shareholders, for your continued support even in these difficult times.
I would like to thank you all for your trust in our company, in our brands and our innovations, in our competitiveness, in our future and your confidence in the people at Henkel, who will continue to do their very best for you every single day. This is what we stand for. This is our commitment. That is my commitment. Many thanks for your attention.