Report on the First Half of 2009: Symrise Remai...
Corporate news announcement processed and transmitted by Hugin AS.
The issuer is solely responsible for the content of this
announcement.
----------------------------------------------------------------------
--------------
* Stable sales
* Restructuring expenses impact earnings position
* EBITDA margin adjusted for restructuring expenses amounts to
18.9% in first half year; 20.2% in second quarter
* Strong operating free cash flow totals ¤ 62.8 million
Symrise AG held its ground well in the first half of 2009 despite a
persistently difficult market environment. In a declining total
market, the Group achieved stable sales. Although its earnings
position was burdened with high raw material prices as well as
restructuring and integration expenses, Symrise generated an EBITDA
margin of 17.3%.
Dr. Heinz-Jürgen Bertram, Symrise's Chief Executive Officer,
explained, "Symrise has performed well in a still difficult market
environment. We implemented a number of restructuring measures in the
first half of 2009 and are already beginning to see the first
results. However, the full effect of these measures will not be felt
until beginning of next year. The adjusted EBITDA margin of over 20%
in the second quarter demonstrates that Symrise is operationally in
good shape."
Sales rose from ¤ 676.0 million to ¤ 685.1 million in the first six
months. This represents an increase of 1% (at local currency: -1%)
compared to the strong prior-year period.
Especially in the South America region, sales grew dynamically by 15%
(at local currency: 22%). In North America, the acquisitions made in
the previous year contributed significantly to sales, which grew 31%
(at local currency: 19%). In the Asia-Pacific region, sales increased
by 5% (at local currency: -1%). The EAME region, which
proportionately has the highest sales, continued to be adversely
affected by the recession in major sales markets as well as continued
customer destocking during the first half. Here, sales fell by 10%
(at local currency: -9%). However, a slight rebound could be seen in
the course of the second quarter.
First positive effects of restructuring measures
Symrise remained highly profitable in the first half of 2009. In
addition to the subdued sales growth, high raw material prices as
well as restructuring and integration expenses continued to put a
strain on the earnings position. However, the Group succeeded in
defending the price increases implemented in recent months in this
difficult environment. Moreover, Symrise realized its first cost
savings from restructuring measures implemented in the first six
months.
Symrise achieved earnings before interest, taxes, depreciation and
amortization (EBITDA) of ¤ 118.6 million (previous year: ¤ 142.9
million) in the reporting period. This corresponds to an EBITDA
margin of 17.3%, following 21.1% in the same period last year.
Adjusted for restructuring expenses, the EBITDA margin reached 18.9%.
In the second quarter, the earnings position already reflected the
first positive effects of the restructuring measures, resulting in an
adjusted EBITDA margin of 20.2%, compared with 17.6% in the first
quarter.
Underlying net income for the first half amounted to ¤ 61.9 million
(previous year: ¤ 69.7 million). Accordingly, underlying earnings per
share fell from ¤ 0.59 to ¤ 0.52. In the second quarter, the amount
was ¤ 0.28 and, thus, on the same level as the corresponding
prior-year quarter (¤ 0.29).
Strong operating free cash flow
By means of diligent management of its working capital, Symrise
considerably increased the operating free cash flow in the first half
of 2009 from ¤ 22.6 million to ¤ 62.8 million. On June 30, 2009, the
net debt of the Group amounted to ¤ 647 million, thereby slightly
exceeding the level on December 31, 2008 (¤ 642 million). By placing
a ¤ 75 million promissory note loan, Symrise took the first steps to
improve the maturity profile of its debts. With an equity ratio of
33.5%, the Group's financial position as of the end of June is
extremely solid.
Growth still driven by major customers
Symrise again saw growth generated by its major customers in the
first half of 2009. Sales from the ten largest customers rose 5.0% in
the Scent & Care division (at local currency: 0.2%) and 3.1% in the
Flavor & Nutrition division (at local currency: 1.6 %). Thus, Symrise
now generates 29% of its consolidated sales from this customer group.
Scent & Care also gained an important core list position in the first
half; moreover, both divisions won attractive new projects. "This
makes us confident regarding the second half of 2009," CEO
Heinz-Jürgen Bertram commented.
Scent & Care - stable sales, optimized structures in EAME
The Scent & Care division profited from the dynamic growth in South
America as well as from sales growth in the North America and
Asia-Pacific regions. They were able to largely compensate for the
decline in sales in the EAME region, which is strongly affected by
the recession. The Scent & Care division, thus, kept sales stable in
the first half with ¤ 343.6 million, compared to ¤ 342.7 million in
the previous year (at local currency: -2%). If the effects of the
acquisitions made in 2008 are taken into account, sales in the
division decreased by 3% (at local currency: -6%). The Life
Essentials division was a major sales driver while the demand in the
luxury divisions Personal Care and Fine Fragrances continued to be
subdued.
The division's EBITDA decreased from ¤ 67.5 million in the previous
year to ¤ 50.6 million. Scent & Care implemented targeted measures in
this reporting period to improve the cost structure, optimize the
supply chain and consolidate production. A location in Spain was
closed, and the closing of an additional plant in Switzerland was
initiated in order to bundle the entire production for the EAME
region in Holzminden, Germany. Adjusted for restructuring costs, the
division's EBITDA amounted to ¤ 57.8 million, the adjusted EBITDA
margin was at 16.8%.
Flavor & Nutrition - Sales Growth and Process Optimization
Sales in the Flavor & Nutrition division rose by 3% to ¤ 341.5
million (previous year: ¤ 333.3 million). Adjusted for exchange rate
effects, revenues grew by 1%. Here, growth was also driven by the
regions South and North America and by transactions with major
customers. In North America, the integration of Chr. Hansen Flavors
in 2008 had a positive effect on sales performance. If the effect of
the acquisition made in 2008 is taken into account, sales in the
division decreased by 2% (at local currency: -4%). The division
expanded its innovation platform in the reporting period by
establishing a new Health & Nutrition competence center.
The earnings position of the Flavor & Nutrition division was also
affected by destocking, high raw material prices and restructuring
expenses. EBITDA in the first half amounted to ¤ 68.0 million
(previous year: ¤ 75.4 million). Adjusted for restructuring expenses,
the division achieved EBITDA of ¤ 71.5 million and, thus, an adjusted
EBITDA margin of 20.9%. The restructuring measures focused on the
optimization of production structures, among other things the closing
of a location in Western Europe, and on the improvement of business
processes.
Outlook
"We confirm our expectations for the year 2009," attested
Heinz-Jürgen Bertram. "The Flavor & Fragrance market will presumably
shrink slightly this year. Customers continue to destock and the
costs of important raw materials remain at a high level.
Nevertheless, we expect that the sales development of Symrise will
continue to be better than the overall market development and that we
will generate a strong cash flow in 2009 as well."
Key Financial Figures for the First Half of 2009
Change
H1 | 2009 in % (actual Change
H1 | 2008 in ¤ exchange in % (local
in ¤ millions millions rates) currency)
Sales 676.0 685.1 1.4 -0.8
- Scent & Care 342.7 343.6 0.3 -2.3
- Flavor & 2.5 0.7
Nutrition 333.3 341.5
EBITDA -17 -21
EBITDA margin in % 142.9 118.6
Adjusted EBITDA 21.1 17.3
margin in % 21.1 18.9
EBITA 123.6 96.5 -22 -26
EBITA margin in % 18.3 14.1
EBIT 107.9 77.1 -29 -32
EBIT margin in % 16.0 11.2
Net income for the -33
period 60.8 41.0
Earnings per share 0.51 0.35 -33
Adjusted earnings -11 -17
per share 0.59 0.52
Operating free cash
flow 22.6 62.8
Employees (on 12/31/2008 6/30/2009
reporting date)* 5,097 5,015
* FTE, without
apprentices and
trainees
About Symrise
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 ¤ 1.32 billion in 2008 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 more...
www.symrise.com
For press queries, contact: For investor queries, contact:
Katja Derow, red roses Dr. Andrea Rolvering
communications
Tel.: +49 (0)40 46 96 77 010 +49 (0)69 75 93 75 94
Email: k.derow@redroses-pr.com andrea.rolvering@symrise.com
--- End of Message ---
Symrise AG
Mühlenfeldstraße 1 Holzminden Germany
WKN: SYM999; ISIN:
DE000SYM9999; Index: MDAX, TecDAX;
Listed: Regulierter Markt in Frankfurter Wertpapierbörse, Freiverkehr
in Bayerische Börse München,
Freiverkehr in Hanseatische Wertpapierbörse zu Hamburg, Freiverkehr
in Börse Berlin,
Freiverkehr in Börse Düsseldorf, Freiverkehr in Börse Stuttgart,
Prime Standard in Frankfurter Wertpapierbörse;
Latest directors dealings
- 27 minutes ago AVI Global Trust
- 38 minutes ago LSL Property Services
- 41 minutes ago Bluebird Merchant Ventures (DI)
- 52 minutes ago Power Probe PLC
- 53 minutes ago Origin Enterprises (CDI)