Fragrances and flavours producer industrial group Givaudan announced the half year results 2005.
In the first half year 2005, Givaudan recorded sales of CHF 1,368 million. It maintained its sales in local currencies at the level of last year, despite the on-going reduction of commodity ingredients in both divisions.
In Swiss Francs, this translates into a decline of 2.2 percent. The gross profit increased by one percentage point. Operating profit remained strong, at last year's level, whereas net profit was slightly affected by higher net financial expenses. Cash flow and balance sheet remained solid.
Divisional Sales Fragrance sales grew 2.0 percent in local currencies, in line with the market. Sales in Swiss Francs remained at last year's levels. Consumer Products sales continued to outgrow the market substantially, whereas Fine Fragrance sales were affected by strong comparables. The important number of new wins could not compensate for the erosion of existing business due to shorter life cycles and reduction of inventories in the distribution channels. In Fragrance Ingredients, specialities again showed a very good growth, whereas commodities further decreased according to strategy.
Flavour sales declined by 1.6 percent in local currencies and 3.8 percent in Swiss Francs against the previous year's strong comparables. Sales were affected by our strategy to rationalise low margin flavour ingredients and by lower market prices forvanilla and citrus. Both, Asia Pacific and Latin America, had a good sales performance, whereas Europe and North America could not match last year's strong performance. All regions grew during the second quarter reversing the first quarter's decline.