DSM: maintains positive momentum in challenging markets

Heerlen / NL. (dsm) Royal DSM N.V., the global Life Sciences and Materials Sciences company, reported a third quarter Ebitda of 342 million EUR compared to 270 million EUR in Q3/2012. This improvement of 27 percent was realized despite an ongoing challenging macro-economic environment.

Commenting on the results, Feike Sijbesma, CEO/Chairman of the DSM Managing Board, said: «I am pleased to report increased profitability in all our business clusters despite the initial impact from adverse currency movements and a continued challenging macro-economic environment. Nutrition continued its good performance notwithstanding some headwinds that emerged towards the end of Q3. Materials Sciences also delivered solid performance with higher profits».

«Our focus remains on the full integration of acquisitions and delivery of synergies, which together with continued success in our wide-ranging Profit Improvement Program will help improve DSM´s returns. Current trading conditions are similar to those experienced at the end of Q3, while foreign exchange rates deteriorated. Nevertheless, we are firmly on track to deliver a significant increase in Ebitda for the full year. The 2013 outlook given at our Capital Markets Day remains unchanged».

Sales in cluster Nutrition in Q3 rose twelve percent compared to Q3/2012, mainly driven by acquisitions. Organic sales growth was two percent compared to Q3/2012. Currencies had a -4 percent impact on sales compared to Q3/2012.

Ebitda in cluster Nutrition for Q3 was 242 million EUR, up 20 percent from Q3/2012. The increase was driven by acquisitions, organic growth and the Profit Improvement Program. The Ebitda margin of 22,8 percent was again at the upper end of DSM´s target range. The favourable product mix was partly offset by the initial impact from adverse currency movements.

Human Nutrition + Health in cluster Nutrition delivered five percent organic growth compared to Q3/2012, mainly driven by volume. Compared to the previous quarter, organic sales development was -5 percent driven by the soft demand faced by Food + Beverage customers in developed markets. Moreover, demand for fish oil based Omega three dietary supplements was impacted by sharp retail price increases as the entire value chain pushed through higher raw materials prices. Infant nutrition and premixes performed well. In Q3 Fortitech realized sales of 47 million EUR and Ebitda of twelve million EUR, in line with expectations.

Animal Nutrition + Health in cluster Nutrition delivered an organic sales growth of one percent compared to Q3/2012, driven by the continued recovery in global animal protein production. However, this recovery remains fragile creating price pressure towards the end of the quarter especially in vitamin E. In addition, poultry and aquaculture protein markets continued to be impacted by diseases in several high growth economies. In Q3 Tortuga delivered sales of 76 million EUR and Ebitda of 15 million EUR, in line with expectations.

DSM Food Specialties showed sales growth driven by the contribution of the acquired cultures and enzymes business. The complete statement about DSM´s Q3/2013 is available on the comany´s web server.