Danisco: continued strong top-line momentum

Copenhagen / DK. (das) In the second quarter 2008/2009, Danisco A/S recorded revenue of 3,3 billion DKK and EBIT before share-based payments of 317 million DKK. Organic growth accelerated, reaching eleven percent for the quarter and exceeding our long-term growth targets for the Group. Food Ingredients grew organically by nine percent and Genencor by 16 percent. Danisco´s collaborations with DuPont and Goodyear are progressing well. Financial items were exceptionally strong this quarter. The company maintains its outlook for organic revenue growth but lower our bottom-line outlook due to margin pressure in Sweeteners and Genencor.

CEO Tom Knutzen: «In spite of the tumultuous economic environment, we have so far been able to manoeuvre through the high waters without any dramatic impact on our activity level although we are witnessing shifting customer behavioural patterns. Our long-term vision remains intact. We continue to focus on implementing our strategy, addressing current business challenges and steering our business through the current market volatility. Our highest priority is given to the challenges that we face in Sweeteners and to regaining margin momentum in Genencor».

Highlights of the second quarter 2008/2009

  • Eleven percent organic growth exceeding Danisco´s long-term targets for both Food Ingredients and Genencor.
  • All main areas except for Sweeteners contributing to solid revenue growth.
  • Group EBIT outlook challenged by pressure on xylitol and timing of Genencor´s margin recovery.
  • The DuPont and Goodyear collaborations are progressing well and in line with our expectations.
  • Exceptionally strong quarter for financial items thanks to gains on Direvo divestment and interest rate swaps. Danisco´s funding structure remains stable.
  • The company is lowering its bottom-line outlook for the year due to margin pressure.
  • Further accelerating its focus on optimising Danisco´s manufacturing footprint across the organisation.
  • Discontinued operations – i.e. Sugar – continuing to perform as planned. Danisco still expects the Sugar divestment to close early 2009.
  • The company postpones its share buyback programme due to unstable financial markets.

Outlook for 2008/2009

Danisco A/S lifts its revenue estimate to 13,3 billion DKK (13,0 billion DKK) and maintains its estimate for organic growth of at least six percent. The management now expects EBIT of around 1,3 billion DKK (1,4 billion DKK). The company lowers its estimate for profit after tax before share-based payments to around 950 million DKK (one billion DKK).

bakenet:eu