Good morning from Dusseldorf, and welcome to our conference call on the Q3 of 2020. Thank you for joining us. I hope that you and your loved ones are doing well. I'm joined today by Markus Woboda, our Chief Financial Officer. Before we start, let me begin this call reminding everyone that this presentation, which contains the usual formal disclaimer of forward looking statements within the meaning of relevant U.
S. Legislation, can be accessed via our website at henkel.com/ir. The presentation and discussion are conducted subject to this disclaimer. I will not read this disclaimer, but we take it as read into the record for the purpose of this conference call. What's on our agenda today?
First, I'm going to lead you through the key developments in the Q3. Then Marco will comment the Q3 business development in more detail as well as the new full year outlook we provided on October 9. I will close today's presentation with Henkel's business priority. And afterwards, Marco and I are looking forward to answering your questions. Let's start with a brief overview of the key developments in the Q3 of 2020.
The implications of the global COVID-nineteen pandemic continue to affect our business environment, although to a smaller extent compared to the 2nd quarter. By these persisting challenges, Henkel returned to growth in the Q3 and achieved organic sales growth of 3.9% with emerging markets up by 8.8%. I'm glad to say that the strong organic sales growth was supported by each of our 3 business units. In Adhesive Technologies, all business areas recovered compared to the Q2 and the business units delivered positive organic net sales growth, outperforming a still negative industrial environment. Beauty Care delivered a very strong top line performance, in particular, driven by the retail business.
Our Hair Professional business recovered strongly from a very negative Q2 and closed the quarter low single digit negative. Demand for our laundry detergent and wholesale cleaners remained high and Laundry and Home Care achieved significant organic sales growth, worth noting that all regions contributed to this performance. As you know, we also issued a new financial guidance for fiscal 2020 in early October based on the business performance in the 1st 9 months and the assumption on the business development in quarter 4. We are all aware of the fact that infection rates have been rising to new highs in the past weeks. Governments are taking countermeasures and implement new restrictions yet.
There are no complete lockdowns in most countries as we experienced in the Q2. Taking the recent development into account, our full year guidance remains intact. Overall, we have not experienced adverse effects on our business performance in October, although restrictions partly tightened again. At the same time, we note the high level of uncertainty in the environment. In these truly challenging times, the health and the safety of our employees, customers and business partners remains our first priority.
I'm proud to see the team's unbroken dedication and commitment, which allows us to successfully master the current situation and lay the basis for a better future. And I am convinced that the true business transformation requires a cultural transformation. Here, we really moved forward accelerating our cultural journey with our leadership commitment at the core. Much stronger from the crisis, the execution of our purposeful growth agenda continues in full swing. Later in the presentation, I will especially focus on our progress in the area of competitive edge.
Turning back to the Q3 and a brief recap on our business environment, which continued to be impacted by the global health crisis. With the pandemic situation prevailing, life didn't return to the pre COVID times for most. With continued impact on economic activity and private consumption. Looking at currencies, quite some turbulences could be observed. Key currencies for Henkel strongly devaluated in the quarter.
While the business environment remained challenging, demand in key markets and industries recovered versus the Q2. This is evidenced by the development of the industrial production index as well as GDP and private consumption. Still, economic activity and household consumption remained below prior year's levels in many regions and countries. China is a notable exception. Here, industrial production and GDP increased in the mid single digits in the 3rd quarter.
We also observed continued changes in consumer behavior triggered by the COVID-nineteen pandemic with different impacts from category to category. Let me provide you some additional insights on how pandemic related changes in industrial and consumer demand impacted our businesses
in the
Q3. Adhesive Technology, all business areas recovered from the lows in the Q2. However, we continue to face headwinds from lower industrial and automotive production. One particular area of weakness was the Aerospace business, which is accounting for a low single digit share in sales. Our Consumer and Craftsman as well as in our Construction businesses benefited from staycation effect.
Many people were still staying more at home thus demand for do it yourself and construction products increased in quarter 3. And our China business mostly returned back to normal and grew very strongly in the Q3. In Beauty Care, COVID related impacts varied from category to category. While the salon business recovered strongly from a very weak Q2, it could not return to pre crisis levels due to lower traffic in salon and some local lockdown. While social distancing in place, the styling market also developed negatively.
In contrast, personal hygiene stayed on top of mind of consumers. The Beauty Care teams managed to capture these increased demands over proportionate. Humor demand also remained evaluated for at home coloration, even though somewhat lower after a peak in Q2 when many hair salons were forced to close their doors. Laundry and Home Care, strong hygiene consciousness among consumers remained evident in the Q3, leading to increased demand for surface cleaners and toilet care. With people working, cooking and eating more at home, dishwashing product also remained high in demand.
We were able to capture this over proportionally with our impactful innovations and targeted marketing campaign. We emerged stronger from the crisis. We continue to drive the execution of our purposeful growth agenda. Framework we established in the beginning of the year proves right and is guiding our way to win the 20s through purposeful growth. Execution of our growth agenda along the 6 pillars is in full swing.
With regards to shaping the winning portfolio, I'm glad to say that we meanwhile closed both acquisitions we signed this summer. We also advanced implementing our future ready operating model. Today, however, I would like to focus especially on the progress we made in the field of competitive edge, which contributed to the strong organic sales growth in the quarter. Starting with Beauty Care. I already mentioned that consumers stay very aware of personal hygiene.
To cater consumer demand, the Beauty Care teams continue to put increased focus on hygiene related products. This context our North American brand Dial continued its success from the past month recording double digit growth in the Q3. Teams also managed to outgrow the hair coloration market, winning market shares of around 50 basis points in our active markets globally. This outperformance was supported by successful launches such as Simply Color in the U. S.
Or Palette L, favorite. Our nature brands also continued to perform very well, growing double digit in Q3. Moreover, we already saw first promising contributions from key hair care relaunches that came to market in the Q3. With relaunches under our key brand, Gliscor, Cyus and NatureBox, we are addressing around 60% of our hair care retail business truly with impactful innovation. While we are driving sustainability across the group to achieve our ambitious climate, packaging and social targets,
we
are also successfully anchoring sustainability in our product innovation. Part of the relaunches, we are enhancing sustainability features in packaging. We have been industry pioneers in the development of recyclable black plastic packaging, which is now implemented in our Sios Care series. The Nature Box relaunch, we are the world's 1st beauty brand to introduce social plastic as a packaging material for the brand's complete bottle portfolio, which Buddies made up of 98% of social plastic. And lastly, the new packaging of GLIS is now 100% recyclable and a significant share is made from recycled material.
All in all, further improved important steps to promote circular economy and reach our ambitious packaging targets. Laundry and Home Care. The teams did a fantastic job winning market shares of around 150 basis points globally in the hand dishwashing category and delivering clear double digit growth. This great performance was also supported by our Prial 5 plus innovation with self decreasing actions that works up to 5 times faster in lifting degrees, thanks to an innovative surfactant system. Following successful launches supported strong communication since Q1 2020 across key markets in Europe and Middle East Africa, this innovation is rolled out in Germany as we speak.
Let me also share an update on the detergent cap segment, which is of key strategic importance for us. Here, the teams achieved double digit growth building on the successful development of the first half year. Our impactful Persil 4 in-one disc clearly boosted this result, also gaining further market share. Love Nature is our first launch born from our newly established internal sustainability idea factory in laundry and home care. This new cross category brand includes plant based laundry detergents, surface cleaners and dishwashing products with sustainability as a key competitive edge.
Nuff Major is also pioneering the concept of refill stations at the national level with the brand's pilot launch in Germany. The first laundry and home care brand that offers refill stations across various retailers here in our home market. Exciting concept leveraging a startup innovation approach. Let me also share 3 impactful innovations in our Adhesives Technology business. 1st, we saw strong business growth across major smartphone brands with our new series of high end electronically conductive and non conductive adhesive.
The high impact solutions enable the design of a new sensor technology that will allow consumers around the world to use the power of augmented reality featured 5 gs enabled smartphones. We're also catering to changing customer needs in the context of e mobility. Our expanded portfolio of thermal interface management materials is highly demanded by multiple customers, delivering double digit growth. Here, we successfully combined material expertise and engineering support and helped to shape the world's transition to a low carbon economy. Double digit number of projects were kicked off with large OEMs in the Q3, alone thanks to our new high impact offering.
With our portfolio of food safe adhesives for paper straws, we enabled the replacement of plastic straws. Our innovative adhesive solutions not only allow to increase the line speed in manufacturing by more than 4 times, but also improve the consumer experience, for example, through higher water resistance. A great example of how the teams active we contribute to a circular economy by enabling new packaging design with our solution. I would also like to speak out about our advancements in the area of digital, an important value creator and one of our strategic priorities. Here, we continue capturing emerging opportunities in the current environment, helping to accelerate digital sales growth.
I'm very pleased to see that in the Q3, the digital share in overall sales surpassed the 15% for the group with increases in all businesses. Our Beauty Care and Laundry and Home Care businesses combined digital sales grew more than 65% in the quarter with new record levels in all regions. Successful direct to consumer operations, the expansion of strategic customer partnerships and an acceleration in performance marketing also contributed to this strong achievement. Also, our Adhesives Technology business unit recorded double digit growth in the quarter. Here, we are capitalizing on our e shop, which after recent go live in Australia and New Zealand is now live in 55 countries in total.
Throughout the year, the traffic increased significantly with a broad based development across the region. For sure, also a result of high user acceptance and consistently strong user feedback. With this, let me hand over to Marco, who will now lead you through our business development in the Q3 in more detail.
Thank you very much, Carsten, and good morning to everyone also from my side. Let us have a closer look at our sales development in the 3rd quarter. Henkel recorded strong organic sales growth of 3.9% in the quarter. This was in particular due to strong volume expansion of 3.5%. Pricing overall was slightly up year over year in the Q3 at 0.4%.
The net effect of our acquisitions and divestments was slightly positive at 0.1%. As already mentioned by Carsten, currencies were a strong headwind in the quarter and overcompensated the strong organic growth. Sales were negatively impacted by minus 5.5% and especially the U. S. Dollar and many key emerging market currencies devaluated versus the euro.
In case of the Mexican peso, Russian ruble or Turkish lira, on average, even in the mid to high teens percentage range. As a result, Hanger recorded a decrease in nominal sales by minus 1.5 percent to EUR 5,000,000,000 Moving on to the organic sales development by region. Overall, mature markets were positive at 0.6%. Our businesses in Emerging Markets recorded a significant organic sales growth of 8.8%. And Hanger recorded organic sales growth in all regions, except for Western Europe, which was slightly negative at minus 1.2%.
This was due to a lower automotive and industrial production. North America in contrast recorded good organic growth of 2.9%, supported by double digit performance of our Body Care business and a strong development in Laundry and Home Care. The performance in Asia Pacific was positive at +1.2 percent due to a good performance in the region's emerging markets driven by China. Here, we recorded very strong organic sales growth, further improving from an already good second quarter. The mature markets of Asia Pacific declined year over year.
In each of the Eastern Europe, Africa, Middle East and Latin America regions, we recorded double digit growth, each significantly improving from the 2nd quarter. Let me now move to our business units, starting with Adhesive Technologies. As you know, the first and especially the second quarter have been strongly impacted by the COVID-nineteen pandemic. In the Q3, our business was still influenced by demand driven decline of overall industrial production. However, we experienced a sequential recovery in our markets with catch up effects in selected businesses.
Overall, the business unit recorded a positive sales growth of 1.3% in the 3rd quarter. Within Adhesive Technologies, developments in the different business areas and regions varied. Automotive and Metals remained behind the prior year development. However, the business area improved in the course of the quarter. In China, the automotive market mostly recovered and sales are approaching normal levels.
Our packaging and consumer goods business area showed a good organic sales development. This was driven by strong growth of our Consumer Goods business and very strong growth in the Packaging business. Moving on to the Electronics and Industrial business. In that area, overall, we remained below the prior year level, impacted by weak demand in the Industrials business, especially the aerospace industry, which accounts for a low single digit percentage share of total Adhesive Technologies sales, continued to be severely impacted by COVID-nineteen. Our electronics business, in contrast, recorded a positive development.
In Craftsman, Construction and Professional, organic sales growth was very strong in the 3rd quarter. In particular, our Consumer and Craftsman business recovered from a weak second quarter and grew by double digit percentage, partially due to catch up effects. In total, the business unit recorded a positive volume of 0.3%. Pricing continued to be resilient at plus 1% in the period under review. In the Q3, demand recovered across all regions compared to the Q2.
Nevertheless, the regional performance was mixed as the implications of COVID-nineteen on industrial businesses varied across regions. In the Asia Pacific region, the Chinese economy recovered. Here, most of our businesses were mostly back to normal and we achieved very strong organic growth. The other countries in the region, in contrast, remained below the prior year despite recovery trends. Eastern Europe and Latin America each recorded double digit growth with key markets such as Russia and Turkey as well as Mexico and Brazil driving the respective developments.
Africa, Middle East recorded a significant increase in sales. In all of these markets, in particular, the packaging and consumer goods, but also Craftsman, Construction and Professional businesses were strong. On the other side, all mature markets remained below prior year's levels. Western Europe was particularly affected by a decline in the Automotive and Industrials businesses. Moving on to Beauty Care, which achieved very strong organic sales growth of 4.3% in the Q3.
Our retail business showed a very strong performance across both mature and emerging markets. Our largest category, hair, recorded a very strong organic sales growth. As Carsten explained earlier, our at home coloration business grew double digit in the quarter, a key driver for the overall performance. Moreover, the hair care business grew strongly in the quarter, while we continue to feel the negative demand trends for styling products amid social distancing in many countries. Our Body Care business could continue its success already seen in the Q2, achieving double digit growth in Q3.
As you know, this business is especially large for us in North America, where we have our brand Dial positioned handwashing and personal hygiene. While our Hair Professional business was hit by selling closures in the first and especially the second quarter, this business area recovered strongly in the Q3. Throughout the pandemic, supporting our customers was a key priority with measures including prolonged payment terms, digital sales initiatives as well as in store communication and speed service products when lockdowns were lifted. However, the Hair Professional business remained organically below prior year and declined by a low single digit percentage due to hygiene regulations reducing traffic in the salons as well as some local lockdowns. The business unit's very strong organic sales growth was driven by both positive volumes at plus 2.7% and positive pricing at +1.6%.
From a regional perspective, Beauty Care recorded the strongest development in North America region. Here, as mentioned, the Body Care business was the key growth driver, while the Retail business also performed very well. Western Europe achieved positive organic sales growth with both the Retail and Professional businesses contributing. Beauty Care recorded strong organic sales growth in the emerging markets. Eastern Europe and Latin America each posted significant organic sales growth driven by the hair coloration and body care businesses.
And in contrast, the overall business in Middle East Africa was negative due to COVID-nineteen effects. Finally, on to Laundry and Home Care, which had an exceptionally strong quarter with 7.7% organic sales growth with all regions contributing. And from a category point of view, Home Care continued to be the key driver of this performance with strong double digit growth, with each of our core brands, Pril, Breff and Somat, growing double digit. Both our successful product innovations as well as changed consumer behavior towards more hygiene, consciousness supported this development. Also, our laundry care business improved quarter over quarter and achieved strong game sales growth in the Q3 due to significant growth of our mega brand, Brazil.
Here, our innovations offensive is paying off and amongst others with a double digit growth of our 4 in-one discs. And importantly, we were able to grow our market shares in Europe, Middle East, Africa and Asia Pacific. In North America, our market shares are still below prior year. However, our production normalized in the course of the 3rd quarter, following the production issues in Q2. Overall, we recorded very strong organic sales growth in the 3rd quarter in North America also benefiting from catch up effects from a weaker Q2.
Organic sales growth of 7.7% at Laundry and Home Care was solid driven by volume, which increased 8.8% in 3rd quarter. Pricing in contrast was negative at minus 1.1 percent, still impacted by mix effects and trade investments as was the case already in the first half of the year, though now to a low extent. Looking at the geographic split, as you can see on the chart, Laundry and Home Care has been growing in each region in the 3rd quarter. In Asia Pacific, Middle East Africa and Latin America regions, the business unit even recorded double digit growth. Eastern Europe achieved significant growth.
North America, as already mentioned, returned to very strong growth. And also, Western Europe delivered good organic growth. Before we move now to the outlook, let's briefly recap on the organic sales development in the 1st 9 months of the year. The COVID-nineteen pandemic and its implications on economies and societies affected our businesses, especially in the first half of twenty twenty. In particular, our industrial and hair professional businesses were hit, with headwinds on our businesses and sales peaking in the 2nd quarter, while demand recovered strongly in the 3rd quarter.
Laundry and Home Care sustained a strong performance throughout the quarters to date, benefiting from increased hygiene awareness as well as our impactful innovations. For the group, organic sales development amounted to minus 2.1% in the 1st 9 months of 2020. Now back in October, when we issued the new full year outlook, we already anticipated that uncertainty would remain high in the remainder of the year. And as you all know, many countries are experiencing a strong second wave of infections. In some regions and countries, this triggered extensive government reactions, including lockdowns of private life and to a low extent of business activity.
Even before the recent rise in infection rates, market statistics already expected GDP and private consumption to remain below the prior year in Q4. The same holds true for the Industrial Production Index. In a year over year comparison, industrial production is expected to decline by a low single digit percentage in the 4th quarter. And in addition, consumer behavior continues to be impacted by the development COVID-nineteen infection rates and the pandemic related restrictions implemented in the response. So obviously, we continue to operate in a very challenging environment and uncertainty remains high.
Our new outlook, as provided on October 9, is based on the assumption that the industrial demand and business activity in areas of importance to Henkel in the Q4 will be below prior year, but will not deteriorate significantly. For the outlook, we assumed that there will be no far reaching lockdowns in our core regions in the Q4 of 2020 as we have experienced especially in the Q2. So based on these assumptions that we have taken, our outlook is as follows. We do expect organic sales growth of between minus 1% and minus 2% at group level in the full year 2020. And we are expecting the adjusted EBIT margin to be in the range between 13.0% 13.5% at group level, negatively impacted by the expected decline in sales in the Industrial and Hair Salon Businesses due to the pandemic.
Furthermore, and in line with our agenda for purposeful growth, we are also increasing investments in marketing and advertising as well as in digitalization and IT. Adjusted earnings per preferred share at constant exchange rates are expected to decline in the range between minus 18% and minus 22%. And with this, let me hand back to Carsten.
Thank you, Marco. So before we move on to the Q and A, I'd like to outline our key business priorities for the remainder of 2020 beyond. As the global health crisis evolves, we as the management board care and we act. Protecting the health, safety and the well-being of our employees, their families, our customers and our strategic partner remains our highest priority. Our broad set of support measures stays in place as we address the challenges together.
While we are successfully managing the short term, we are keeping sight on the medium and the long term, shaping the company to build on our purposeful growth agenda. We are capturing emerging opportunities with agility and a strong entrepreneurial spirit, be it through impactful innovations or as part of our accelerated digital transformation. Last but not least, we retain our strong focus on liquidity, while we continue to monitor and adequately manage costs, working capital and CapEx. And finally, and especially during these times, we are proud of the strong Hankel spirit across the region and the business. And we continue our cultural journey with passion and with commitment.
Let us now move on to the Q and A. Ladies and gentlemen, the floor is yours.
Thank you. Mr. Knobel, ladies and gentlemen, the question and answer session will be conducted electronically. Time permits. Please limit your questions to a maximum of 2 questions at a time.
Our first question is coming from the line of Christian Faitz from Kepler Cheuvreux. Please go ahead.
Yes. Thank you. Good morning, Carsten, Marco and Lars and team. Two questions maybe. First of all, in Adhesives, if you look at the Automotive segment within Adhesives, how is demand at this point in time, I.
E, in Q4? Has it sequentially further improved from Q3 levels? And then you a more general question for your consumer driven activities, obviously, including consumer demand in thesis, but also home care with a laundry. If we are past the COVID-nineteen pandemic or as you call it in your presentation, staycation effect, Do you expect to see a reversal of the positive lockdown effects we have seen for these activities? Thank you.
So good morning, Christian. So to your first question, when it comes to automotive. So following the shutdowns and the production stops in many countries, the light vehicle production index as a key indicator for the automotive outbox decreased by roughly 25% in the Q1 and around 45% in the second. In Q3, we saw a recovery across regions. Still production volumes remained mid single digit percentage below the prior year level.
So the automotive market in China, and I think we talked about that during the presentation, recorded strongly recovered strongly and almost reached with this prior year level. The development here is for sure also reflected in our automotive business performance in Q3. Sales have been recovering from the lows in Q2, but remained below prior year levels. As per the last update by mid of October and thus before the recent increase in the global infection rates and restrictions for the Q4, IHS expected a development slightly weaker than in Q3. And for the full year, IHS is forecasting it decline by roughly minus 20%.
So and to your second question, Christian, when it comes to consumer staycation effects, maybe if you look first, when it comes to our Laundry and Home Care business, we have to take into account, yes, there is a high comparison base as well as a reversal of pantry loading effects after very strong growth in 2020, but it's also supported by changed consumer demand patterns amidst the pandemic. And in Beauty Care, yes, there are some high comparable basis when it comes to our retail Body Care business. But overall, Christian, I believe now and I think that's something maybe which can which we need to debate since yesterday when there are first signs that vaccines may and will come out. Independent of that, I believe that the hygiene trend, which was, I would say, accelerated by the pandemic, will also stay in 2021 because I think it's not a trend. It will definitely change the consumer behavior and customer behavior going forward.
I hope this clarifies.
Okay. Thank you. But just coming back to my first question, sorry for that. But Q4, I mean, if you look at your order book in Adhesives for Automotive, is this still stronger sequentially stronger than you saw in the previous months?
Richard, I hope you understand that I'm not giving trading comments on Q4. But I think you heard what I said overall for the company in October that we have not seen any adverse effects related to our performance also maybe because of some rising COVID, I would say, closures or impact lockdowns, which have been there. But for trading, I hope you understand. Thank you.
Okay. Thank you, Paisung.
You're welcome.
The next question is coming from the line of Bruno Montaigne from Bernstein. Please go ahead.
Good morning. 2 for me. So one is a bit of a follow on on the previous question around assuming we have an effective vaccine next year that gets deployed rather quickly, what are kind of the biggest shifts we should be looking out for the challenge of you next year? And did I understand correct that you're expecting hygiene growth upon hygiene growth? So despite the very high level of hygiene consumptions, and it's one you'd expect higher growth on top of that rather than some small decline as a headwind.
And the second question is you're mentioning loads of great examples of innovation driving market share growth. But if we take broader across the portfolio of all your consumer brands, have you been able to accelerate the transition you wanted to make your turnaround plan? Has there been sort of a pause in the transition plan and acceleration? And if so, can you quantify with some ways that acceleration? The percentage of markets where you're gaining or losing market share, has it improved?
Or any other measure you would have for that? Thank you.
So good morning, Bruno. Quite intense question. So let me try to start with your first one and taking the situation of the announcement of yesterday. So first of all, from a health perspective, these are for sure encouraging news and the vaccines will play a key role for sure in protecting the lives, especially of the most vulnerable to this virus. From a business perspective, I believe too early to make any predictions or speculations how this would impact our business.
The vaccine will only be submitted to the authorities now for approval. And it is not clear if and when the vaccine will be approved and when we will become really available when this will become available on a wider scale. So let's hope that it will help to fight the pandemic. And I think the rest is what I already said, I think in the context of Christian's question that I believe independent of vaccines that this hygiene topic overall will stay and by that will also impact our businesses on the part. And for Adhesives, looking at Adhesives here per update of mid October, which is before the recent rise in the rates, the implication of restrictions, the IHS expected GDP and industrial production in 2021 to increase by about 4%, respectively, following strong declines in 2020 with significant differences between Industrial segment and the region.
Coming to your second question, Bruno, which is related then more to your question was more to market shares in the consumer businesses. You know that we also have in our adhesives business a significant consumer business, maybe we start with that. Here we're seeing good developments in the last couple of quarters and seeing rising market shares in our consumer setup. If I look at Laundry and Home Care, we see market shares increases really across the world. With the exception of North America.
We pointed that out that here the situation is not satisfying and we're working on that. We have also changed management since a couple of weeks or to be precise since September of this year. We have a new Senior Vice President who's taking care in Laundry and Home Care of our business in North America. And if I look at the Beauty Care business overall, we are seeing overall stable situation of market shares with the significant changes, so differences. So in North America, a very good development.
I alluded during the presentation in terms of the situation of Dial bringing double digit growth into the setup and also good developments in Europe. Independent of that, I would say an overall point because you're also saying are we satisfied with our innovation initiatives and our priorities, which we are setting? From my point of view, there is a clear yes, we are going into the right direction. And I think this is also confirmed by the situation of our development of digital sales. You know that this is one of our priorities.
We have reported that during Q1, Q2, where we have already seen high increases in our consumer businesses in Laundry and Beauty. And we have seen now in Q3 plus 65% growing organic net sales growth for B and L together, which brings our total digital sales of total Henkel sales to a level now of roughly 15%. And here, therefore, I think we are definitely on the right way. For sure, there is still a lot of things to be changed and come. Not everything is perfect, but definitely we are on the right agenda and the purpose for growth agenda is paying into the right direction.
Hope that clarifies you. Thank you. You're welcome, Bruno.
The next question is coming from the line of Guillaume Delmas from UBS. Please go ahead.
Good morning, Carsten and Mark. One point of clarification from you and then two questions. The point of clarification is, would you be able to provide what your organic sales growth would have been in Q3, excluding the catch up effects? And the only reason I'm asking is so we can get a better feel for your run rate in October. And then my two questions.
I mean, firstly, pricing in Laundry and Home Care. I was surprised to see a small sequential deterioration in Q3, particularly given that in Africa, Middle East, you've probably been growing in the high teen territory in Q3 and I would expect some nice pricing contribution there. So what's driving this negative pricing? Is it more promotional activities in the North America? And given what's happening on the foreign exchange front in emerging markets, do you see scope for additional pricing actions in EM for Laundry and Home Care?
And then my second question, I guess more big picture question, it's about your margin mindset, because your guidance for 2020 implies a 300 basis points decline versus last year, a 400 basis points decline versus 2018. So curious to hear how you look at your margin development from 2021 onward. Is it going to be about getting back as fast as you can to your 2018 peak margin levels? Or are you going to be looking at reinvesting maybe more behind the business, which would mean a more modest annual margin expansion going forward? Thank you.
So good morning, Guillaume. So good that also Marco comes now into play. He will may comment on the catch up effect and also on the pricing. Maybe let me start with the margin mindset. And I hope you also understand that we will not make today a guidance for 2021.
As you can imagine that the situation is quite difficult to judge and independent of that it's anyway not planned for today. One thing is clear, and I think this is what we outlined in March, you referred to the margin decreases we had been also stating at that point. We have our purposeful growth agenda. And for us, it is important. And I alluded to that before when Bruno had his question in terms of market shares and how we are doing overall.
I think it's important to pay into our purposeful growth agenda. And on the long term, it is important that we have the right brands, that we have the right innovations and that we support the innovations in the right setup. And I think that is what we disclosed in March, where we, on the one side, had this margin reset and on the other side where we also clearly pointed out that our midterm guidance stays intact in terms of our organic growth 2% to 4% with more at the higher end of that range and also the situation that we are planning to have a mid- to high single digit EPS growth with adjusted at constant currencies. And there is no change to that. And I think that's the overall situation what I can allude to.
As I said, we are having good signs that we are working into the right direction. And by that, what with the midterm is implied, a profitable growth development is something which will not change. And the rest will come in 2021. And maybe that's for the more consumer oriented part. For the industrial part, you see that the industrial recovery is not something, and I think that's not new, which will come immediately back in 2021 with the full extent.
So it's definitely depending on categories that it will take longer than a year. And all of that we will take into account when we will judge the situation how 2021 will look like also from a guidance perspective. I hope that clarifies a little bit more, Guillaume. And with this, I hand over to Marco for the other two for the other questions last remark.
Yes. Guillaume, your first question was on organic sales growth in the Q3 and catch up effects. And indeed, we like we said, we have experienced some catch up effects in the Q3. And in Adhesive Technologies, we saw a catch up in customer orders, particularly in July August in our Consumer and Craftsman business when comparing to the 2nd quarter. And also in Laundry and Home Care business, in particular North America, which was, to a large extent, driven by catch up effects following the production issues we had experienced in the Q2.
As you can maybe imagine, it's not easy doable to quantify these effects now exactly in the given market situation to really distinguish what is a catch up, what is a normal consumer demand in that environment, which is characterized by a particular high volatility. So we refrain here from giving really a quantification, but we give you some color on the businesses that are affected and that you can make up your mind to the magnitude. On the pricing for Laundry, the question was on why that is negative, in particular now in the Q3. Now what we saw is that we have on average negative price effects, mainly driven by mix effects in the portfolio and also driven by higher trade investments as was the case already in the first half of the year. So that is more continuing the trend.
And we see that in particular in Europe, where we also then introduced a lot of innovations into the market. While now looking at other regions, in particular, into the emerging markets, we did see strong volume gains across the emerging markets. And also in Middle East Africa, for example, we saw not only volume being strong, but also price up also as a reflection of the strong currency declines that we had seen in that region. So it's a bit of a mixed picture. But overall, mix and trade investments are the key drivers of that.
Okay. Thanks.
The next question is coming from the line of Richard Taylor from Morgan Stanley. Please go ahead.
Good morning, everyone. Thanks very much for the questions. I would love if you could give us an update on your disposals and the progress that you're making in terms of the underperforming brands at the tail of the consumer business. So that's my first question. And then a very simple one on Turkey.
I think Turkey is still a significant business for you. Obviously, the currencies had a little bit of a move there. Could you just update us on your business in Turkey and perhaps some of the mitigating actions that you're taking? Thank you.
Marco, you take them.
Yes. On the first on the question update on disposal. In the course of the year so far, we have completed divestments and discontinuations with a total volume of roughly €80,000,000 sales, mainly in the Adhesives business and some smaller brands in the consumer business. And compared to the last update in mid August, there have not been further material divestments or discontinuations at that moment in time. However, in the current environment, we mostly focus on setting up our structured divestment processes in order to be ready when markets come back.
And here, I can say that we did make further progress, so we are well on track in our preparation of further disposals. And what I can say at this moment in time is that we are fully committed to execute the announced portfolio measures in the defined time frame by the end of 2021. And we will come back with further information as soon as that is possible. If
I'm sorry, go ahead.
No, Richard, go ahead.
Yes, just sorry, if I may just have a follow-up on acquisitions. You've made some pretty interesting acquisitions over the last 12 months. So I appreciate that disposals have been a bit of slow progress. But maybe you could just talk a little bit about the changes that you're making in terms of digital and also beauty tech that have come via some of those acquisitions?
Richard, on that, I think we have a clear path that M and A remains an integral part of our strategy going forward. And I think we can clearly say that M and A that we also have here clear competencies and clear strength, which is also confirmed again what I said at the beginning of my speech that both acquisitions, which we did over the last couple of months, have been not only signed, but have been already closed. And by that, we integrate them already in our businesses. And the ones which we just mentioned are really 2 compelling ones, which on the one side in Beauty Care, here we are increasing our D2C, direct to consumer business and our digital capabilities. And by that, I think that's definitely the right way where we need to go, which is also confirmed by our digital sales expansion.
And with the Adhesives 1, which we did here, we are broadening our position in the North American sealants market with this really becoming a strong having a very strong position in that. And yes, both are in line and I hope you understand that what is in the pipeline, I will not comment at this point. Maybe we have still the topic of Turkey, which is our open Marco.
So Turkey in total accounts for roughly 2% of group sales. So it's a larger country, but not one of the largest. Of course, We do see for sure that the currency has devaluated substantially. And for sure, we will be hit by translation effects out of it, and that for sure also played a part of the FX related decline in net sales that we did report on also for the 3rd quarter. We do see, however, that also we have volume growth in Turkey in important business.
So overall, I think we do fairly well in that environment. But for sure, on the translation part, we will have an impact.
Thank you. You're welcome, Richard.
The next question is coming from the line of Celine Panuti from JPMorgan. Please go ahead.
Good morning. Thanks for taking my question. First question would be
on
raw material cost inflation. Could you tell us what kind of environment you are seeing in the second half of the year? My understanding was that in Additive Technology, this was probably deflationary. So I'm quite surprised that your pricing are remaining positive. Can you comment on whether there are special effects in that and whether we should expect pricing to start weakening or not as we look into Q4 into 2021 in Adhesive Technology?
And then my second question on online. Could you give us how much of your sales are in consumer, so in Beauty and Laundry and Home Care altogether in online. You said they were up 65% this quarter. And you also mentioned that D2C was doing well. So could you mention what is it that you have in D2C in this category and how big it is?
Thank you.
Marc, could you start with the raw material?
Good. So first question on raw material price inflation in the second half. So in the Q3 of 2020, Henkel on a group level recorded a small headwind from gross material price movements with, however, a quite differentiated development through the business units. When we go deeper than looking at Adhesive Technologies, here we recorded slightly declining gross material prices due to the tailwinds in petrochemical categories, driven by the sharp decline of the oil price and lower global demand. In Beauty Care, on the other hand, we recorded a gross material price increase in the low single digit percent.
This was in particular driven by higher prices for contract manufacturing as well as short fragrance markets. And then lastly, Laundry and Home Care, we did experience an increase in the low single digit percent mainly affected by short markets in fragrances and also in bleaches. For the full year 2020, we do expect gross prices of direct materials to remain roughly stable compared to the prior year. And that is the current picture that we do see, so quite differentiated. And you're right, in A, we have been able to keep prices up to some extent.
That is for sure also a mix effect, but also we have quite a good market position with our broad offering of high impact solutions. And here, we do set prices based on the value creation of the underlying solutions and not so much on the methodology of cost plus. So that is what also helped us in the given environment in Adhesive Technologies. For 2021, please do understand that we cannot an outlook and guidance now. I think we have to see how it further develops, and then we will give guidance also on the year 2021 in due course.
So Celine, for your second question, the terms of online, to give you here a rough number, the Laundry and Home Care, so both businesses, Laundry and Beauty together, so the consumer businesses are around 10% of total sales with beauty a little bit higher, laundry a little bit lower related to that number.
And in D2C?
D2C, we don't disclose that in this part. It's also too early because we just have acquired the business and we are not giving this split at this point.
Thank you.
You're welcome. You're welcome.
We will now take our last question from Ian Simpson from Barclays. Please go ahead.
Well, good morning, everyone, and thanks for squeezing me in. Couple of questions for me, please. Firstly, you've highlighted the catch up effects in both Adhesives and Laundry, which I assume is inventory rebuild at the customer end. Are you able to give any indication as to the size of the benefit from that, please? And whether we might see any more inventory rebuild in Q4?
And then perhaps just discussing your Home Care business, can you just remind us how big surface cleaner and dishwash both are as a proportion of your overall Laundry and Home Care business, please? Thank you very much.
So, Ian, very specific questions. I think for the first one, Marco has already, I would say, answered that the catch up effect to quantify them are not really possible or to distinguish between normal business and the catch up effects. And to your question now of Home Care in terms of surface cleaner and you bringing me a little bit into the point that I don't have these numbers ahead of my mind. So maybe we will either come back to that or let me have a look. Yes, I think it's I need to come back to that.
Otherwise, I think it's otherwise, I would give wrong numbers, which I don't want and I'm not having not all these numbers in the head of my mind. I hope you understand.
Of course, we can come back to that. Thanks.
No problem. Thank you, Ian.
Thank you. Ladies and gentlemen, I will now hand over to Mr. Knobel for his closing remarks.
So dear investors and analysts, thank you very much for your questions. And let me close today's presentation with a summary of our key takeaways. Given the dynamic development of the pandemic, the health and the safety of our employees, their families and our business partner, this remains really our first priority. And despite the continued challenging economic environment, Henkel returned to growth in the 3rd quarter and delivered strong organic sales growth with all business units really contributing to this. And with this, confirming the breadth and robustness of our balanced business portfolio with successful brands and innovative technology.
Already in the beginning of October, we have provided our new outlook for fiscal 2020 in a business environment that remains highly uncertain. Due to our solid financial foundation, our strong company culture with our dedicated employees at the heart and our new momentum, we are confident to emerge stronger from the crisis. Our low debt levels and the significant financial flexibility give us really room to maneuver. We are firmly committed to our purposeful growth agenda. We will continue to drive our strategic initiatives constantly, adapting to evolving market dynamics and the results.
As always, please be reminded of our upcoming events. Our next event will be the release of our full year 2020 results on March 4. With this, I would like to thank you for joining our call today. Take care, stay safe and stay healthy.