Continued strong top-line momentum
In Q2 2008/09, Danisco recorded revenue of DKK 3.3 billion and EBIT before
share-based payments of DKK 317 million. Organic growth accelerated, reaching
11% for the quarter and exceeding our long-term growth targets for the Group.
Food Ingredients grew organically by 9% and Genencor by 16%. Our collaborations
with DuPont and Goodyear are progressing well. Financial items were
exceptionally strong this quarter. We maintain our outlook for organic revenue
growth but lower our bottom-line outlook due to margin pressure in Sweeteners
and Genencor.
CEO Tom Knutzen comments: '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
•11% 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.
•Our 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.
•We are lowering our bottom-line outlook for the year due to margin pressure.
•Further accelerating our focus on optimising Danisco's manufacturing footprint
across the organisation.
•Discontinued operations - i.e. Sugar - continuing to perform as planned. We
still expect the Sugar divestment to close early 2009.
•We postpone our share buyback programme due to unstable financial markets.
Outlook for 2008/09
We lift our revenue estimate to DKK 13.3 billion (DKK 13.0 billion) and
maintain our estimate for organic growth of at least 6%. We now expect EBIT of
around DKK 1.3 billion (DKK 1.4 billion). We lower our estimate for profit
after tax before share-based payments to around DKK 950 million (DKK 1
billion).
Read more in the enclosed file.
