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Givaudan Reports Good 2011 Financials


GENEVA, Switzerland—Givaudan reported healthy growth in the first half of 2011, according to Gilles Andrier, its chief executive officer (CEO).  “In the first half year 2011, we achieved a local currency growth of 4.3 percent, in line with our mid-term guidance," Andrier said. “Raw material cost increases have affected our profitability. Givaudan has successfully implemented price increases in collaboration with its customers. These price increases started to become effective in the course of the second quarter. Givaudan's business momentum continues to be strong with a full project pipeline and a further increased win rate. We therefore are confident to achieve our ambitious mid-term targets."

Group sales for the first six months of the year totaled CHF 2,005 million, an increase of 4.3-percent in local currencies and a decline of 8.8 percent in Swiss francs compared to the previous year.

Fragrance Division

Fragrance Division sales were CHF 927 million during the first six months of 2011, an increase of 3.9 percent in local currencies, but a decline of 8.8 percent in Swiss francs over the same period in 2010. The growth was driven by a strong performance in the Consumer Products business unit, particularly in the developing markets of Latin America and Asia Pacific, as well as in Fragrance Ingredients. The continued rise in raw material prices had a significant impact on profitability but the division is working together with its customers to compensate this effect through higher prices.

Total sales for Fragrance compounds (Fine Fragrances and Consumer Products combined) increased by 3.5 percent in local currencies but declined in Swiss francs to CHF 799 million from CHF 884 million.

Fine Fragrance sales decreased 0.4 percent in local currencies. The slight fall in revenue is to be compared to the strong comparables of last year as the strong performance in Latin America could not offset the decrease in sales in North America. Consumer Product sales increased by 4.7 percent in local currencies, driven by a strong performance in Asia Pacific and Latin America, particularly with the large international customers.

The EBITDA decreased by 18.9 percent to CHF 159 million from CHF 196 million. The EBITDA on a comparable basis was CHF 166 million, below the CHF 226 million reported last year. When measured in local currency terms, the EBITDA on a comparable basis decreased by 19.9 percent. The EBITDA margin on a comparable basis decreased to 17.9 percent from 22.2 percent versus last year.

The operating income decreased by 25 percent to CHF 87 million from CHF 116 million last year. The operating margin on a comparable basis reduced from 15 percent to 10 percent, as higher raw material prices made their impact felt. The operating income on a comparable basis was CHF 94 million, compared to the CHF 153 million reported last year.

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