Company and Industry Highlights * Company: Givaudan SA (OTCPK:GVDBF) * Industry: Fragrance, Taste & Wellbeing * Date: January 24, 2025 * Key Highlights: * Strong Performance: Givaudan reported a strong performance in the first half of 2024, driven by high sales growth across all markets, segments, and customer groups. * Sales Growth: Sales reached CHF3.7 billion, a growth of 12.5% on a like-for-like basis and 5.7% in Swiss francs. * EBITDA and Profitability: Comparable EBITDA increased to CHF929 million, lifting the EBITDA margin to 24.8% from 22.7% last year. Net income increased by almost 31% to CHF588 million. * Market Segments: Fragrance & Beauty Group grew at 15.3%, while Taste & Wellbeing division grew at 9.9%. High-growth markets represented 46% of total sales. * Innovation: Givaudan focused on innovation, launching new products and addressing consumer needs in areas like biotechnology, sustainability, and digitalization. * 2025 Strategy: Givaudan outlined its 2025 strategy, focusing on expanding the portfolio, expanding customer reach, and focusing market strategies. * Outlook: Givaudan expects continued growth in 2024, with a focus on operational excellence and navigating a volatile geopolitical environment. Key Points * Management Changes: Tom Hallam, CFO, retired and handed over the position to Stewart Harris, effective August 1, 2024. * Sales Performance: * Fragrance & Beauty: Sales grew 15.3% on a like-for-like basis, driven by volume growth and new wins. * Taste & Wellbeing: Sales grew 9.9% on a like-for-like basis, driven by volume growth and new wins. * Market Performance: * High-growth Markets: Represented 46% of total sales and grew at a strong double-digit rate. * Latin America: Showed the highest like-for-like growth with 31.5%, driven by FX pricing in Argentina. * Asia Pacific: Grew at 11.4%, with all key markets contributing to the growth. * EMEA: Grew 11.4%, with strong performance in mature and high-growth markets. * North America: Posted positive like-for-like growth in the first half of the year. * Innovation: * Scentaurus Vanilla: A long-lasting, high-performing non-colouring vanilla note for liquid detergents. * Nympheal: A game-changing ingredient for white floral fragrances. * Alternative Dairy Ingredients: Enabling customers to use natural proprietary ingredients for alternative dairy products. * Digitalization: Launching a new digital platform for co-creative innovative wellness experiences. * Financial Performance: * Group Sales: Over CHF3.7 billion, an increase of 5.7% in Swiss francs. * EBITDA: Increased to CHF906 million compared to CHF763 million in 2023. * Net Income: Increased to CHF588 million, a growth of 30.9% compared to 2023. * Free Cash Flow: Increased to CHF197 million, a growth of CHF93 million compared to 2023. * 2025 Strategy: * Expand Portfolio: Acquired B kolor in Italy to expand in the beauty makeup space. * Expand Customer Reach: Focus on local and regional clients. * Focus Market Strategies: Focus on growth opportunities in high-growth markets and emerging markets. * Outlook: * Input Costs: Expected to increase slightly. * Operational Excellence: Focus on operational excellence and footprint optimization. * Geopolitical Environment: Navigate a volatile geopolitical environment. Additional Information * Conference Call Participants: Alex Sloane (Barclays), Celine Pannuti (JPMorgan), Charles Eden (UBS), Daniel Buerki (ZKB), Arben Hasanaj (Vontobel), Georgina Fraser (Goldman Sachs), Nicola Tang (BNP Paribas) * Q&A Session: Covered various topics including margins, volumes, pet food, packaged food, Taste & Wellbeing margin, FX impact, raw material procurement strategy, balance sheet, capital allocation priorities, and beverage and consumer products within fragrance.
Givaudan SA (GVDBF) Full Year 2024 Earnings Call Transcript