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Givaudan Q1 Sales Rise; But Fine Fragrance Declines

Posted: April 16, 2013

Givaudan SA’s first-quarter total sales rose 3.9% on a like-for-like basis and 2.7% in Swiss francs from a year ago as its flavor and consumer products business increased. However, sales in fine fragrances and fragrance ingredients were lower than the year-ago quarter.

For the first quarter, total group sales rose to CHF 1.09 billion from CHF 1.06 billion a year earlier. The company also backed its mid-term outlook to grow organically between 4.5% and 5.5% per year, assuming a market growth of 2-3%.

First-quarter fragrance division sales rose to CHF 517.1 million, a growth of 4.2% on a like-for-like basis and 3.6% in Swiss francs. Givaudan’s consumer products business posted a 5.7% growth on a like-for-like basis of the compounding business (Fine Fragrances and Consumer Products), although sales in fine fragrances and fragrances ingredients were lower than in the first quarter of 2012.

Fine fragrance sales declined 5.5% on a like-for-like basis as compared to the year-ago quarter. The company said new business remains strong, although it was not sufficient to offset comparably higher levels of erosion in Europe and North America where sales declined in both regions versus the previous year. In Latin America, Givaudan said the business continues to deliver strong growth led by new business and volume gains at a number of accounts. First-quarter sales of fragrance ingredients declined by 5.6% on a like-for-like basis. The excellent growth achieved in Europe could not compensate the decline of the commodity sales in the other regions, the company said.

Meanwhile, Givaudan’s flavor division sales reached CHF 571.8 million, representing a 3.7% growth on a like-for-like basis and 1.9% in Swiss francs. Flavor sales increased in the developing markets of Africa, China, India, Indonesia and Eastern Europe as a result of existing product growth and new wins. In addition, growth in the mature markets of North America and Western Europe was offset by declines in Australia, Japan and Korea.

Growth by segments can be attributed to double-digit gains in snacks and strong performance in beverages and dairy. For its flavor unit, sales in Latin America were among the largest growth regions, at 6.3% on a like-for-like basis, continuing on the success of the previous year. Sales for Asia Pacific increased 3.7% on a like-for-like basis and sales for Europe, Africa and the Middle East grew 4.0% on a like-for-like basis. Sales grew 1.9% on a like-for-like basis in North America.