Another record quarter for Frutarom23 Nov 2015
Frutarom has reported another record quarter with 11.3% growth in revenues to $234.5m and 15.0% growth in EBITDA to $45.2m.Net income jumped 47.8% to a record $30.9m.
Frutarom has reported another record quarter with 11.3% growth in revenues to $234.5m and 15.0% growth in EBITDA to $45.2m.Net income jumped 47.8% to a record $30.9m.“We are continuing on our campaign of rapid and profitable growth and present another record-breaking quarter across all key parameters while continuing the successful implementation of our rapid and profitable growth strategy,” said Ori Yehudai, President and CEO of Frutarom, “which combines internal growth, at rates above the growth rates of markets in which we operate. Our strategic acquisitions contributed to sustained improvement in Frutarom's performance and the achieving of another record quarter in sales, operating margins and net income, as well as cash flow, despite the considerable continuing effect of the US dollar strengthening against the various currencies in which we transact business. This reduced revenues this quarter by 14.6%. We are continuing to both raise our market share in the United States and growing emerging markets as well as to enter new expanding fields such as the natural colors and natural solutions for food protection and preservation, along with deepening our activity in specialty citrus and reinforcing our savory activity in North America, China and in Poland. Continued profitable internal growth alongside the contribution by our acquisitions, together with steps we are taking to optimize our resources, position Frutarom and reinforce its standing as a leading global player in the fields of flavors and specialty fine ingredients.” "As part of the implementation of this strategy, we are continuing to work at considerably expanding the scope of our sales and market share,” he continued. “Growth in the first nine months of 2015 (on a constant currency and pro-forma basis) reached 5.1%. Successful integration of the acquisitions made in 2013-2014 and the beginning of 2015, expansion of our activity and market share in the more rapidly growing markets, as well as deepening our activity in the United States combined with expanding our product mix with emphasis on a natural and healthy product portfolio, support continued accelerated growth. These steps have contributed and will continue to contribute towards the continuing steady improvement in the profitability of Frutarom's core business as well, and thanks to them we registered a record high 22.1% EBITDA margin for core activity in the third quarter (adjusted for non-recurring expenses) which already reaches the strategic goal we set for ourselves for the year 2020.” "This year we have already carried out 11 strategic acquisitions, three of them since the beginning of the third quarter including AMCO in Poland (the purchase agreement was signed after quarter end). Frutarom continues to maintain a high level of liquidity and conservative leverage, based on the strong cash flows from operating activities that allows us to continue initiating and seizing acquisition opportunities in reliance on our strong and high-quality acquisitions pipeline. The acquisitions we are performing, combined with organic growth, contribute to the continued expansion of our operations while creating a diverse geographic mix for our activity, with emphasis on emerging markets with higher than average growth rates as well as on the United States which is the world's largest market for flavors.”"In the framework of working towards expanding our global presence, in the last few months we have strengthened our activity in the Asia-Pacific region through the acquisition of Taura and accelerated our penetration into the growing markets of India and Africa through the acquisition of Sonarome and the Indian activity of BSA. In addition, construction has been completed of our new advanced plant in China, which includes sophisticated laboratories for development and applications, now in the run-in phase. Now, for the very first time, Frutarom also has the local capability in China to develop and produce savory flavor solutions. We are convinced the new plant will contribute towards a major leap forward in our activities in China and East Asia which constitute additional important target markets for growth and for leveraging our competitive advantages. The deepening of our savory field activity in Central Europe is another important move, made possible with the acquisition of AMCO which operates in the growing Polish market. Also, our acquisitions of Ingrenat, Nutrafur and Vitiva have enabled us to create an efficient and modern production platform for our growing global activity in natural extracts from plants.”"We are convinced the rapid and profitable organic growth and the acquisitions, combined with continuing improvement in the product mix, our focus on natural and healthy products in accordance with demand by consumers, geographic expansion in emerging markets with higher than average growth rates and in the US, and the steps we are taking to optimize the resources at our disposal while capitalizing on the abundant cross-selling opportunities and the operational savings inherent in them, the building of a global purchasing infrastructure and a strong pipeline of additional synergetic strategic acquisitions will support our continuing journey of profitable growth in the coming years as well and of reaching the goals we recently set for ourselves: sales exceeding US$ 1.5 billion with an EBITDA margin of over 22% in our core activities by the year 2020."
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