Danisco A/S: raises profit outlook after strong quarter

Copenhagen / DK. (das) In the first quarter 2010/2011, Danisco A/S recorded revenue of 3,9 billion DKK, a 13 percent increase Y/Y made up of five percent organic growth and eight percent positive currency effect. The group Ebit (before Bio Chemicals Projects – BCP) came in at 687 million DKK, reflecting a margin expansion of 2,0 percentage points Y/Y. All four divisions contributed to the higher margin. Profit for the Group came in at 402 million DKK against 306 million DKK in the first quarter 2009/2010, an increase of 31 percent.

CEO Tom Knutzen: «Already this quarter, we achieved our long-term financial ambitions, including a twelve-month average Ebit margin (before BCP) of 13,7 percent. This was driven by good progression in all four divisions, including a recovery in Sweeteners, as well as a positive currency impact. We are currently addressing our new financial ambitions for the future and expect to communicate on these in connection with our planned Capital Markets Day. Furthermore, based on the solid start to the year, we lift our financial outlook for the year». Highlights:

• Revenue and Ebit came in well ahead of last year, reflecting stronger performance in most business areas driven by factors such as a broad-based, improved product offering and production efficiencies.
• Organic growth came in at five percent for the Group driven by all four divisions (Enablers four percent, Cultures six percent, Sweeteners one percent and Genencor seven percent).
• Ebit (before BCP) came in at 687 million DKK, reflecting a margin of 17,6 percent for the quarter driven by all four divisions (Enablers 18,1 percent, Cultures 24,3 percent, Sweeteners 8,3 percent and Genencor 19,6 percent).
• Group Ronoa reached 20,6 percent, up from 13,7 percent in the first quarter of the last year, driven by improvements in all four divisions.

Outlook for 2010/2011

For FY 2010/11, Danisco nows expect to realise revenue of around 15 billion DKK (previously more than 14,5 billion DKK) and Ebit (before BCP) of 2,1 to 2,2 billion DKK (previously around 2,0 billion DKK), resulting in an Ebit margin (before BCP) of around 14 percent (previously around 13,5 percent). The company expects profit for the year of around 1,2 billion DKK (previously more than 1,0 billion DKK).