Givaudan with solid growth & integration on track in H1

10 Aug '07

5 min read

During the first six months of 2007, sales increased to CHF 2,005 million from CHF 1,474 million in the previous year. This resulted in a growth of 36.3% in local currencies and 36% in Swiss francs. These sales include the acquisition of Quest as of 2 March 2007 and also reflect a good momentum of the combined business.

On a pro forma basis - which reflects the combined activity of Givaudan and Quest over the period ending 30 June 2007 and assumes that the acquisition had taken place on 1 January 2006 - sales increased by 4.4% in local currencies and 4.6% in Swiss francs. Excluding the ongoing flavour portfolio streamlining, pro forma sales growth was 5.7% in local currencies.

Gross margin, EBITDA and operating profit margins in pro forma terms improved slightly compared to previous year's level. Pro forma net profit declined by 20%, related to a one time, non-cash tax adjustment.

Sales:
Sales of the Fragrance Division rose to CHF 909 million, increasing by 49.8% in local currencies and 49.9% in Swiss francs. In pro forma terms, sales growth reached 6.8% in local currencies and 7.5% in Swiss francs. A strong growth of the Consumer Products business in all regions was the primary factor contributing to this success.

Fine Fragrance sales advanced against strong comparables. Sales of speciality ingredients achieved again double digit growth rates. Sales of the Flavour Division totalled CHF 1,096 million. This represents a growth of 26.8% in local currencies and 26.2% in Swiss francs.

In pro forma terms, growth reached 2.4% in local currencies and 2.2% in Swiss francs. The discontinuation of commodity ingredients impacted sales by CHF 27 million. Excluding this effect, the Flavours Division would have reached a pro forma first half sales growth of 4.9% in local currencies.

Flavour sales in Asia Pacific reported strong single digit growth during the first six months of 2007, benefiting from a solid double digit sales growth in China, India and Indonesia. In Latin America, first half sales exceeded last year's result, advancing in the single digit range and led by the solid sales development in Argentina and Chile.

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