dsm-firmenich has shared the company's 2023 full-year sales results, with pro forma1 sales at 12,310 euro/10,627 euro on an IFRS bases2. Below are the highlights from the report provided by dsm-firmenich as well as a brief outlook for 2024. For the entire report, visit dsm-firmenich's website.
- Successful creation of dsm-firmenich with integration well ahead of plan
- Merger-related cost and sales synergies gaining traction
- Animal Nutrition & Health to be separated from the group
- Solid performance across the company, significantly impacted by unprecedentedly low vitamin prices
- Good operating cash flow driven by a strong performance in the second half
- Stable dividend of €2.50 proposed
- Synergies and the vitamin transformation programs will deliver significant earnings step-up in 2024 and beyond
- Outlook 2024: Adjusted EBITDA of at least €1.9 billion
Dimitri de Vreeze, CEO, commented, "We are proud that the company is already operating seamlessly with integration well ahead of plan, including the development of a common culture, as demonstrated in our recent employee engagement survey. Our employees have done a truly amazing job building momentum, positioning dsm-firmenich as a world leader in nutrition, health and beauty.
In light of the unprecedented conditions with very low vitamin prices and a continued destocking cycle, we took a number of immediate and effective actions. We accelerated our plans for driving through additional self-help measures and advanced the review of all our business segments. This led us to the initiation of a process to separate out the Animal Nutrition & Health business from the Group which we announced today. This should strongly reduce our exposure to vitamins earnings volatility and reduce our capital intensity in line with our long-term strategy. We believe that the full potential of the ANH business could be best realized through a different ownership structure.
Supported by our exciting innovation pipeline, all these actions would help us to prioritize and accelerate the company's nutrition, health and beauty high-growth and higher-margin businesses, all of which is reflected in our mid-term financial targets."
Looking Forward
dsm-firmenich shared that the company's full-year 2024 outlook is only on those elements that are under the company's control, namely a €200 million step-up in Adjusted EBITDA from a combination of synergy delivery and the vitamin transformation program. Considering that the full negative vitamin effect emerged only in Q2 2023, the effective Adjusted EBITDA run-rate in the period Q2-Q4 2023 on an annualized basis was about €1.7 billion, the company estimates for FY 2024 Adjusted EBITDA of at least €1.9 billion.
1Represents the figures on a pro forma basis, including the Firmenich results as if the merger had occurred on January 1, 2022. The pro forma figures represent the results from continuing operations
2Represents the figures on an IFRS basis, including the Firmenich results as of the merger date May 8, 2023.
