June 24 - Danish ingredients company Danisco A/S Wednesday maintained its outlook for the coming financial year despite economic and financial uncertainty, as it reported a swing to a net profit in the fourth quarter after the sale of its sugar unit.
Focus on execution
In FY 2008/09, Danisco posted revenue of DKK 13.0 billion, up 6% Y/Y (4% organic growth). EBIT before share-based payments and special items* came in at DKK 1,248 million, and group profit for the period closed at DKK 72 million (DKK 108 million after minorities).
CEO Tom Knutzen comments: ‘This year has been marked by achievements and challenges for Danisco. We executed the Sugar divestment in line with our commitment to stakeholders – and for the continuing part of Danisco our strategic priorities remain intact. We have the right platform to accommodate the opportunities and challenges of the future through innovation, sustainability and focus. However, we also recognise the necessity to improve our performance through higher earnings, better utilisation of our capital employed and reductions in our net working capital. These are all prerequisites for meeting the demands of our stakeholders going forward and to deliver superior value creation.’
Highlights
-
Full-year organic growth 4% (Food Ingredients 3%, Genencor 7%). Strong growth at the start of the year for all segments aside from Sweeteners; the latter part of the year marred by general economic slowdown.
-
Group organic growth rates in Q4 better than we expected after Q3 across all Food Ingredients areas except for Sweeteners – albeit market transparency levels still low. Genencor also continuing to experience good momentum in most major business areas.
-
Full-year EBIT of DKK 1,248 million, a result of margin improvements in Enablers and in Cultures, but declines in Genencor and Sweeteners. Q4 margins up Y/Y for all non-Sweeteners areas – including Genencor.
-
Full steam ahead for Genencor’s Bio Chemicals Projects (BCP) with DuPont and Goodyear throughout the year – making solid advances in both.
-
Group profit for the year of DKK 72 million, slightly better than we expected after Q3.
-
Net debt reduced by DKK 4.8 billion over the year (DKK 8.5 billion over the past three years) – year-end gearing 2.5 times EBITDA.
-
Danisco’s Board of Directors proposing a dividend for FY 2008/09 of DKK 7.50 per share (unchanged Y/Y),
i.e. a total payout of DKK 356 million.
Outlook for 2009/10
We recognise the currently high levels of economic and financial uncertainty. Nevertheless, we have decided to maintain the usual level of detail in our outlook also for FY 2009/10. We expect organic revenue growth of 3-4%, EBIT of around DKK 1,300 million (this year DKK 1,248 million) and group profit for the year of around DKK 650 million. For further details, please refer to page 16 in the pdf-file.