- Group sales up 15.4 % at Â€ 1.57 billion
- EBITDA margin rises to 21.1 %
- Refinancing successfully concluded. Basis set for further profitable growth
- EPS Â€ 1.13 (+58 %), significantly increased dividend to Â€ 0.60 per share
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Subtitle: - Group sales up 15.4 % at Â€ 1.57 billion - EBITDA margin rises to 21.1 % - Refinancing successfully concluded. Basis set for further profitable growth - EPS Â€ 1.13 (+58 %), significantly increased dividend to Â€ 0.60 per share
Holzminden March 9, 2011 (euro adhoc) - Symrise AG has exceeded its sales and earnings goals for Fiscal Year 2010. The Group benefited from the global economic recovery and strong boost in demand, as well as the excellent positioning in emerging markets and in the business with large customers. Symrise increased sales by 15.4 % to EUR 1.57 billion and exceeded its target to achieve sales growth of at least 8 %. The EBITDA margin rose to 21.1 % and bet the aspired mark of more than 20 %. On another positive note, Symrise succeeded in further reducing its net debt thanks to operating cash flow being at a high level again.
"We capitalized on the strong tailwind of the economic recovery and ran our utilization at very high levels the whole year round," said Symrise AG Chief Executive Officer, Dr. Heinz-JĂĽrgen Bertram. "Besides continued strong growth in emerging markets, we benefited from a strong revival in demand in Western Europe and other established markets. This resulted in record growth of over 15 %, with double-digit sales increases in all regions and in both divisions. With an EBITDA margin of 21.1 % we have operated on a very profitable basis. We would like our shareholders to participate in this success and are proposing a 20 % dividend increase to EUR 0.60 per share."
"In Fiscal Year 2010 we systematically continued to implement our proven strategy: Our innovative business units such as Life Essentials and Consumer Health launched new products which pick up on consumersÂ´ needs for a balanced diet and healthy lifestyle. Our traditional flavor & fragrance business has been extended by significant investments, including a two-fold increase in our menthol production capacity. In 2011 we will continue to focus on sharpening our specific profile."
With a view to 2011, Heinz-JĂĽrgen Bertram continued: "WeÂ´re optimistic about the current financial year and have set ourselves the goals of again outperforming market growth and winning market shares. At the same time, we do remain realistic: Following the outstanding year 2010 which was also driven by economic backlogs we are expecting more moderate growth for 2011. In this context the course of the crisis in the Middle East plays a role; another determining factor will be the oil price development which is difficult to predict and its influence on consumer behavior. At the same time we expect raw material prices to be one of the main challenges which we will keep a close eye on. Since this already became apparent in the middle of 2010, we implemented initiatives at an early stage: we expanded our backward integration of our supply chain, entered price negotiations with our customers and continued our consequent cost discipline. We are therefore sticking to our aspiration of permanently being one of the most profitable companies of our sector, and working on the basis of a sustained EBITDA margin of above 20 %."
15 % rise in sales - double digit growth in all regions
Fiscal Year 2010 Group sales rose 15.4 % (11 % at local currency) to EUR 1,571.9 million (2009: EUR 1,362.0 million). The Group benefited from both, a rebound in customer confidence in its established markets, as well as continued strong consumption in emerging markets.
Asia/Pacific was again the fastest growing region with 21 % sales growth (11 % at local currency). All application areas developed positively there, with demand for cosmetic ingredients, fine fragrances and aroma molecules rising particularly strong. Latin America was able to build on the previous yearÂ´s dynamic trend and - despite high comparables - generated 18 % sales growth (12 % at local currency). North America successfully returned to the growth path and reported a 16 % sales growth (10 % at local currency). EAME, which includes Europe, Africa and the Middle East, also benefited considerably from the economic recovery. Demand in the application areas Fine Fragrances and Personal Care rose particularly strongly here, contributing to an overall sales growth of 12 % (11 % at local currency) in the region.
Emerging markets account for 46 % of Group sales
The growth seen in 2009 in emerging markets continued unbowed in 2010, with sales rising 13 % in these markets. Overall, Symrise generated 46 % of Group sales in emerging markets. Symrise expanded its footprint in these regions with the inauguration of a production site in Moscow, the integration of Futura Labs - acquired at the start of the year - in the Middle East and North Africa, and the opening of the first academy for perfumers in India.
14 % increase in business with large customers
Business with multinational food and consumer goods manufacturers remained a key strategic focus: Symrise won further core list positions with large customers and augmented existing listings with additional projects in 2010. Group sales realized through business with Top 10 customers rose 14 % at local currency. Overall, activities with this customer group which is strategically particularly important, accounted for around 30 % of Group sales.
Flavor & Nutrition boosted sales with Top 10 customers by 15 % at local cur-rency and achieved strong growth in all application areas and regions. Scent & Care increased sales with Top 10 customers by 13 % at local currency, benefit-ing particularly from the expansion of the business in the USA.
35 % rise in EBITDA - EBITDA margin at 21.1 % at a high level
After EUR 245.6 million in 2009, Symrise reported 2010 earnings before interest, tax, depreciation and amortization (EBITDA) of EUR 331.2 million. This 35 % increase was attributable to strong sales growth, high utilization and consequent cost management. Despite sharp rises in individual raw material prices in the third and fourth quarters, the overall raw material costs were kept stable over the full year. Symrise benefited from a number of factors including backward integration in the purchasing of key raw materials such as vanilla, as well as from relatively favorable conditions which had been secured early on.
The GroupÂ´s EBITDA margin improved to 21.1 % (2009: 18.0 %) thereby exceeding the companyÂ´s target of achieving an EBITDA margin of more than 20 %. Net income went up 58.4 % to EUR 133.5 million (2009: EUR 84.3 million). Earnings per share rose accordingly to EUR 1.13 from EUR 0.71 in 2009.
Year on year operating cash flow rises despite higher working capital Although working capital went up as a consequence of the high utilization levels, Symrise succeeded in increasing its operating cash flow to EUR 235.1 million (2009: EUR 225.7 million). The ratio of net debt including pension provisions to EBITDA fell from 3.1 at year end 2009 to 2.2 at December 31, 2010, thereby fulfilling the aspired target.
In the fourth quarter of 2010, Symrise arranged a comprehensive refinancing and aimed at an early redemption of existing debt in the amount of EUR 621 million; this net debt was originally due at the end of 2011. Besides a long term loan of US$ 175 million from US investor Prudential (Pricoa), Symrise was able to raise EUR 300 million on the capital markets through an inaugural bond issue. The Group finalized the refinancing in December with the conclusion of a EUR 300 million revolving credit line and now operates on the basis of a longer-term oriented financial structure which is more diversified in terms of its maturity profiles and financing sources.
Scent & Care - 48 % rise in EBITDA
Scent & Care reported double digit growth rates for all application areas and regions and increased sales by 18 % (12 % at local currency) to EUR 805 million (2009: EUR 682 million). The strong performance was driven particularly by the Personal Care and Fine Fragrances units. Fine Fragrances clearly benefited most from the economic rebound and the improved consumer sentiment; the unit achieved the highest growth within the division.
During 2010, Scent & Care launched new products in all application areas, including new ingredients for anti-aging creams in the Life Essentials application area. The division also realized two major strategic investment projects with the inauguration of two new mixing and dosing facilities for perfume oils and the start of the expansion of its menthol production facilities.
Scent & Care enjoyed particularly strong growth in both, North America and EAME: both markets benefited from the returned demand for Fine Fragrances and Oral Care Products, with each reporting 13 % growth in sales at local currency. Asia/Pacific also grew very dynamically with 12 % growth in sales at local currency and was able to exploit strong consumer demand for cosmetic ingredients, UV filters and Fine and Special Fragrances. In Latin America sales also developed positively, however, the growth rate of 10 % was more moderate because of the exceptionally strong figures in 2009.
Scent & Care increased EBITDA by 48 % to EUR 161 million (2009: EUR 109 million); EBIDTA margin of the division went up to 20.0 % (2009: 16.0 %).
Flavor & Nutrition - 22.2 % EBITDA margin
The Flavor & Nutrition division also grew positively in all application areas. Sales rose 13 % (10 % at local currency) to EUR 767 million (2009: EUR 680 million). Growth was particularly driven by high demand in the beverage area, as well as by business with Top 10 customers.
Business was most dynamic in Latin America, where Flavor & Nutrition sales rose 15 % at local currency. Growth was also strong in Asia/Pacific and EAME, both of which reported 10 % sales growth at local currency. In Asia/Pacific, SymriseÂ´s global initiative "Naturally Citrus" provided for strong growth, espe-cially in its beverages applications. Growth in the EAME region was driven by the established Western European markets as well as by Eastern Europe and the Gulf region. High demand in Russia confirmed SymriseÂ´s decision to expand its footprint in this market. Symrise had acquired an existing facility from the Russian Aromaros-M group at the beginning of 2010, which it subsequently expanded and took into operation in December. In North America, Flavor & Nutrition sales grew 7 % at local currency. In doing so, the business benefited particularly from activities with major customers which were further expanded by a new core listing in June.
Flavor & Nutrition EBITDA rose 25 % to EUR 170 million (2009: EUR 137 million). With the EBITDA margin increasing to 22.2 % (2009: 20.1 %) the division was able to improve its already high profitability further.
We are convinced of our strategy: The focus on our strong position in Emerging Markets, our innovative business units Life Essentials and Consumer Care, as well as the expansion of our business with major customers have been the basis of our success in 2010 and will support our successful development in 2011.
For the current financial year, Symrise is confident that both divisions, Scent & Care and Flavor & Nutrition, will both outperform the overall market for flavors and fragrances and expand their market share. The Group aims at increasing sales by 3 to 5 % at local currency and is projecting an EBITDA margin of more than 20 % for 2011.
In EUR million
2009 2010 Change in % Change in % LC
Sales 1,362.0 1,571.9 15 11
EBITDA 245.6 331.2 35 32
EBITDA margin in % 18.0 21.1
EBIT 163.0 244.4 50 47
EBIT margin in % 12.0 15.5
Net income 84.3 133.5 58
EPS in EUR 0.71 1.13 58
Proposed dividend in EUR 0.50 0.60 20
Share price as of 31.12.
in EUR 14.98 20.53 37
Operating cashflow 225.7 235.1
Scent & Care
Sales 682.3 804.5 18 12
EBITDA 109.0 160.8 48
EBITDA margin in % 16.0 20.0
Flavor & Nutrition
Sales 679.7 767.4 13 10
EBITDA 136.6 170.4 25
EBITDA margin in % 20.1 22.2
Balance sheet total 1,895 2,059
Capital ratio in % 36 41
Net debt (incl.
pension provisions) 773.4 733.7
Employees / FTEÂą 4,954 5,288
Âą Not including apprentices and trainees, FTE = Full Time Equivalent
Symrise is a global supplier of fragrances, flavorings and raw materials as well as active ingredients for the perfume, cosmetics and food industry.
Its sales of EUR 1.57 billion in 2010 place the Company among the top four in the international flavor and fragrance market. Headquartered in Holzminden, Germany, Symrise is represented in more than 35 countries in Europe, Asia, the United States and South America.
Used by manufacturers of perfumes, cosmetics and foods, our innovative products are an inseparable part of daily life. At Symrise we combine an awareness of consumer trends with cutting-edge technologies, focusing on developing innovative fashion and lifestyle products that have additional practical value for the consumer. Symrise - always inspiring moreÂ… www.symrise.com
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