Citing currency valuations and the global economic slowdown, Frutarom (Haifa, Israel) has reported third quarter sales of $111.6 million, down 7%, year-over-year. Sales for the first nine months of 2009 fell 15.5% compared to the same period 2008, totaling $316.7 million. Gross profit for the third quarter and first nine months was $41.2 million (2008: $45.3 million) and 37% (2008: 37.7%), respectively. The company's Oxford, FSI and Chr Hansen (savory business) acquisitions have contributed an estimated $8.1 million to third-quarter and $17.2 million to nine-month sales. Meanwhile, Frutarom expects to return to its traditional performance, noting that customer destocking has slowed and a "gradual improvement in consumption" is underway.
Of the results, CEO Ori Yehudai said, "The global crisis changed the growth trend that characterized most of the global markets in recent years. Frutarom entered this challenging and crisis-related period as a leading and strong global company, with a solid capital structure and an experienced global management. Since the breakout of the global economic crisis, Frutarom deepened its focus and decisively acted to strengthen its competitiveness and to improve its operational efficiency while tightly reducing and controlling its expense level. Concurrently, we continue to strengthen our R&D and sales infrastructures to ensure the continuation of our profitable growth. Our rapid alignment toward the global economic situation enabled us to maintain our operating and EBITDA margins and to improve our net margin in spite of the slowdown in the markets. We estimate that the stabilization of the global economy in recent months, the moderation in currencies fluctuations, the halt of the destocking trend and the signs of gradual improvement in consumption, including in countries significantly affected by the devaluation in their currency, will contribute to an improvement in our sales level and to future return to a growth trend at rates similar to those characterizing our activities in the past.
"We will continue decisively to act to implement our rapid growth strategy which integrates organic growth and strategic acquisitions. In 2009 we have already implemented three successful strategic acquisitions, which support the further expansion of our global deployment, our customer base throughout the world and our product portfolio. The excellent cash flow we achieve, our solid capital structure and strong support from leading financial institutions will enable us to continue with our acquisition strategy and to exploit opportunities created and which will be created as a result of the global economic crisis. We are convinced that we will be able to achieve our target and to again double Frtuarom's sales turnover in the next four years, to approximately $1 billion."