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Givaudan Announces “Solid” 2008 Results; “Confident” About Future

Posted: February 17, 2009

Givaudan (Geneva) has announced its full year 2008 results, reporting a 6.7% increase in local currency group sales totaling CHF 4,087 million and a decrease of 1.1% in Swiss francs compared to the previous year. The company’s operating income increased 17.7% to CHF 379 million from CHF 322 million last year, while its operating margin, on a comparable basis, was flat at 11.9% in 2008 versus 2007. Additionally, its EBITDA increased 12.5% to CHF 765 million in 2008 from CHF 680 million in 2007, and the EBITDA margin, on a comparable basis, was 20.6% in 2008, compared to 20.9% in pro forma terms reported last year.

Fragrance

Givaudan’s fragrance division sales for 2008 were up 7.9% in local currencies to CHF 1,898 million, but dropped 0.1% in Swiss francs versus 2007. Its EBITDA increased 20.8% to CHF 348 million in 2008 from CHF 288 million in 2007, whereas the operating income was up 29.7% to CHF 153 million from CHF 118 million last year. The division’s solid result was driven by the above market growth of fine fragrances and the good growth of specialty ingredients and the consumer products business.

Flavor

Givaudan’s flavor division reported sales of CHF 2,189 million, representing a growth of 5.8% in local currencies and a decline of 2.0% in Swiss francs. The EBITDA reached CHF 417 million in 2008 from CHF 392 million in 2007, reporting an increase of 6.4%, while the operating income increased by 10.8% to CHF 226 million from CHF 204 million last year. Despite adverse economic conditions, sales in mature markets of Europe and North America increased due to new wins, and sales grew across all segments, witnessing a double-digit growth in snacks, and high single-digit growth in the savory and dairy segments.

Future Outlook

In 2009, Givaudan will continue to focus on increasing its share in developing countries and in key market segments, and is confident of achieving the savings target of CHF 200 million by 2010 and reach its pre-acquisition EBITDA margin level of 22.7% by 2010.