DSM Q1 Profits Boosted by Nutrition Sales

The world's leading vitamin maker reported quarterly net profit of €145 million ($188 million), down 13 percent from a year ago, and quarterly operating profit of €200 million ($260 million), also down 13 percent. Sales rose 3 percent to €2.29 billion.

8 May 2012 --- Dutch food and chemicals group DSM on Tuesday reported better-than-expected first-quarter results and gave a cautiously optimistic outlook for the full year.

The world's leading vitamin maker reported quarterly net profit of €145 million ($188 million), down 13 percent from a year ago, and quarterly operating profit of €200 million ($260 million), also down 13 percent. Sales rose 3 percent to €2.29 billion.

In Q1 2012 sales increased by 13% as a result of the Martek acquisition (7%), organic sales growth (4%) and currency developments (2%). Prices and volumes increased, especially in Animal Nutrition and Health.

EBITDA remained strong and was higher than Q1 2011. The better performance was due to strong sales performance and the additional two months’ contribution of Martek in combination with a favorable US dollar exchange rate and a positive effect from continued cost management.

Commenting on the results, Feike Sijbesma, CEO/Chairman of the DSM Managing Board, said “In a challenging business environment, DSM continued to make good progress in Q1 and the robust results represent a positive start to 2012. In Life Sciences, Nutrition continued to deliver excellent performance despite the currency headwinds, benefiting from the acquisition of Martek and continued organic growth. Materials Sciences delivered an improved performance compared to the previous quarter in Performance Materials and another good result in Polymer Intermediates.

“We continue to make important steps in the execution of our strategy. During the quarter we established the joint venture with US based POET, one of the world’s largest bio-ethanol producers, to unlock the exciting potential of advanced cellulosic biofuels. Last week we announced the execution of a Merger Agreement with Kensey Nash and planned tender offer, which will put DSM Biomedical clearly on the map as the second new growth platform for DSM in addition to our Bio-based Products & Services business.

“DSM has successfully transformed itself into a Life Sciences and Materials Sciences company. Our attractive portfolio in health, nutrition and materials together with our broad geographic spread with a significant presence in high growth economies and our very strong balance sheet has positioned us well to deliver shareholder value with stronger, more stable growth and profitability. We remain cautiously optimistic for 2012 despite the uncertain macro-economic situation.”