Off to a positive start to 2020/21 with good commercial traction and integration of acquisitions on track
•Q1 2020/21 organic sales growth was 10%, equally split between volume/mix and price, and driven by Health & Nutrition, which delivered 15% growth, while Food Cultures & Enzymes delivered 8% growth
•Underlying EBIT margin b.s.i. (see reconciliation on p. 20) of 28.5%, incl. 1%-point negative currency impact, compared to 29.0% in Q1 2019/20. Reported EBIT margin b.s.i. (incl. all acquisition impacts) was 25.2%
•Integration of probiotic acquisitions well on track, but temporary capacity constraints in HMO will phase part of expected FY21 revenues and capex to FY22
•Outlook for 2020/21 is unchanged on all key parameters
EUR million Q1 2020/21 Q1 2019/20 Growth
Revenue 243.5 220.0 10.7%
EBITDA before special items 87.8 80.1 9.6%
EBIT before special items 61.4 63.8 (3.8%)
Profit from continuing operations 36.1 45.6 (20.8%)
Free cash flow before acquisitions and special items (6.9) 7.5 (192.0%)
Organic growth 10% 2%
Gross margin 55.9% 60.2%
EBITDA margin before special items 36.1% 36.4%
EBIT margin before special items 25.2% 29.0%
ROIC excl. goodwill 20.6% 29.4%
CEO Mauricio Graber says: “Our first quarter came in quite strong on a relatively easy comparable from Q1 last year, with good performance across our business, especially within Health & Nutrition. We were able to win new business, launch new products in Food Cultures & Enzymes and drive upselling in key markets such as cheese – all despite the difficulties of COVID-19. We have more product launches scheduled for the current financial year, which will help to ensure that we have a healthy commercial pipeline in the years to come.
Chr. Hansen is on track to execute on our 2025 strategy and become a focused bioscience company based on a unique microbial and fermentation technology platform. This is a year of transition, where we need to secure a successful integration of the acquired businesses. We have started out strong, and we will address any challenges that may arise in those processes head on and with determination. The divestment process of Natural Colors is also on track and the business delivered as expected.
Our outlook for 2020/21 remains cautious, and despite COVID-19 we are able to maintain our outlook on all key parameters. This means that we will still outgrow the underlying markets as we strive to deliver industry-leading growth rates.”
Outlook for 2020/21
Organic revenue growth 5-8%
EBIT margin before special items 27-28%
Free cash flow before special items, acquisitions and divestments EUR 120-160 million
The guidance for EBIT margin before special items and for free cash flow before acquisitions and special items assumes constant currencies from the time of this announcement and for the remainder of the financial year.
Chr. Hansen is a global, differentiated bioscience company that develops natural ingredient solutions for the food, nutritional, pharmaceutical and agricultural industries. At Chr. Hansen we are uniquely positioned to drive positive change through microbial solutions. We have worked for over 145 years to enable sustainable agriculture, cleaner labels and healthier living for more people around the world. Our microbial and fermentation technology platforms, including our broad and relevant collection of around 40,000 microbial strains, have game-changing potential. Matching customer needs and global trends we continue to unlock the power of good bacteria to respond to global challenges such as food waste, global health and the overuse of antibiotics and pesticides. As the world’s most sustainable food ingredients company, we touch the lives of more than 1 billion people every day. Driven by our legacy of innovation and curiosity to pioneer science, our purpose – To grow a better world. Naturally. – is at the heart of everything we do.
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