Danisco's Ingredients Record Margin Improvement

21/03/07 In the first three quarters of 2006/07 Danisco recorded revenue of DKK 15,220 million, EBIT before special items of DKK 1,620 million and consolidated profit after tax of DKK 806 million. At group and segment level, profit and cash flows were as anticipated. Free cash flow was DKK 1,439 million. In Q3 an additional DKK 40 million provision was expensed to cover damages in the SPEZYME ETHYL patent infringement case as well as DKK 105 million in Sugar to cover the quota reduction restructuring levy for 2006/07 to the EU.

EBIT margin in Ingredients year-to-date up 0.7 percentage points to 12.9%. All ingredients divisions recorded an EBIT margin improvement in Q3 on last year – patent case provision excluded.

Revenue is expected at around DKK 20.75 billion against previously around DKK 21 billion, with Ingredients now expected to record revenue slightly under DKK 13.75 billion as the increased focus on the profit margin has resulted in slightly lower organic growth. Sugar revenue is expected at slightly over DKK 7.0 billion due to lower export sales. EBITDA before special items and share-based payments is maintained at around DKK 3,300 million. In Ingredients, EBITDA is reduced by DKK 25 million to around DKK 2,525 million due to a DKK 40 million provision relating to the SPEZYME ETHYL patent dispute, while EBITDA in Sugar is adjusted from around DKK 900 million to around DKK 950 million. The outlook for consolidated profit before share-based payments and after special items is changed from around DKK 1.0 billion to slightly over DKK 1.0 billion.