Symrise sees “highly dynamic” growth11 Aug 2015
Symrise has announced that it continued its highly dynamic growth course in the second quarter of 2015 and further increased its profitability. In the first half of the year, the group says it increased sales by 41% to €1,330.8 million (H1 2014: €941.8 million) and operated highly profitably with an EBITDA margin of 22.6%. All regions and […]
Symrise has announced that it continued its highly dynamic growth course in the second quarter of 2015 and further increased its profitability. In the first half of the year, the group says it increased sales by 41% to €1,330.8 million (H1 2014: €941.8 million) and operated highly profitably with an EBITDA margin of 22.6%. All regions and both segments contributed to this positive development. The fully integrated activities of Diana contributed sales of €268.0 million. Earnings before interest, taxes, depreciation and amortization (EBITDA) were up by 44% to €300.3 million (H1 2014 normalized: €209.0 million).
“Symrise continues to stand for high growth combined with outstanding profitability,” said Dr. Heinz-Jürgen Bertram, CEO of Symrise. “We are thoroughly satisfied with our first-half performance. We experienced strong demand in all regions and both segments. Despite the economic and political uncertainties in some markets, we are looking ahead to the second half with confidence. We have a broadly diversified portfolio, a strong market presence and see clear growth opportunities for both segments.”
For the first half of the year, Symrise increased its sales by 41% to €1,330.8 million (H1 2014: €941.8 million). At local currency, this represents a sales growth of 32%. Along with €268.0 million in sales from the activities of Diana, which was acquired last year, the company benefited above all from strong demand for natural flavors and cosmetic ingredients.
Excluding the contributions from Diana, Symrise increased its sales by 13% (local currency: 6%) and thus once again significantly outperformed the global market for fragrances and flavours, which is estimated to be growing at a rate of 2 – 3% per year.
In emerging markets, Symrise recorded a 32% increase in sales at local currency. These markets thus accounted for 47% of total sales (H1 2014: 48%). The slight decline compared to the prior-year-period reflects the regional sales mix of Diana, which generates the majority of its sales in developed markets.
Earnings before interest, taxes, depreciation and amortization (EBITDA) showed a disproportionately strong growth compared to sales and increased by 44% to €300.3 million (H1 2014 normalized: €209.0 million). On a group-wide basis, the EBITDA margin rose to a new all-time high of 22.6% (H1 2014 normalized: 22.2%). Net income for the period staged by 22% and came in at €133.5 million (H1 2014 normalized: €109.1 million). Earnings per share rose from €0.90 (normalized) to €1.03.
Cash flow from operating activities impacted by tax expenses – early refinancing implemented
Cash flow from operating activities for the reporting period amounted to €86.0 million (H1 2014: €108.9 million). The change primarily reflects higher income and trade tax payments as well as taxes payable for Diana.
The Flavor & Nutrition segment increased sales by 75% (65% in local currency) to €784.3 million in the first half of the year (H1 2014: €449.3 million). Adjusted for consolidation effects from Diana, sales in the segment rose by 15% (9% in local currency).
Flavor & Nutrition signed numerous new orders and also benefitted from strong demand for natural flavours and a dynamic trend in pet food applications.
The strongest growth among regions was in Latin America, where sales rose by 155% in local currency. Sales in North America nearly doubled, with a 92% year-on-year gain. In the EAME and Asia/Pacific regions, Flavor & Nutrition achieved a sales growth of 60% and 35%, respectively.
Normalized EBITDA in the segment rose from €99.2 million in the previous year to €176.1 million. The EBITDA margin increased in the period under review from 22.1% to 22.5%. Diana contributed €58.1 million to EBITDA.
After a strong first half, Symrise confirmed its outlook for the fiscal year 2015. Despite political tensions in some regions and divergent economic trends in some sales markets, Symrise said it is generally optimistic. The group expects demand to remain strong in all regions and both segments. For 2015, Symrise aims once again at outperforming the global market for fragrances and flavours and delivering an EBITDA margin of more than 20%.
The long-term growth drivers remain intact, Symrise said. The group will benefit from global megatrends such as economic progress in emerging markets, population growth and the increasing demand for natural foods and consumer goods products. Symrise is convinced that it is very well positioned to meet the resulting demand and achieve the business goals it has set for the fiscal year 2020.
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