DSM Reports Strong Q1, as Martek Integration Progresses

Sijbesma: "The integration of Martek started immediately and the contribution to our profit is in line with expectations. Our business outlook for the rest of the year is positive and we expect 2011 to be a strong year for DSM.”

4/27/2011 --- DSM has reported that Q1 EBITDA from continuing operations was up 14% to € 325 million. Life Sciences results were driven by the ongoing good performance in Nutrition, while Materials Sciences posts solid results reflecting volume gains and pricing strength. The company reported that 2011 is expected to be a strong year for DSM towards achieving the 2013 targets.

Commenting on the results, Feike Sijbesma, CEO/Chairman of the DSM Managing Board, said: “Our robust performance in Q1 2011 represents further progress towards our 2013 targets as we continue to successfully execute our strategy. This improvement can be attributed to our focus on innovation, our global customer base, excellent market positions and presence in high growth economies.`

“In the quarter we successfully completed our acquisition of Martek, welcoming its employees to DSM.
The integration of Martek started immediately and the contribution to our profit is in line with expectations. Our business outlook for the rest of the year is positive and we expect 2011 to be a strong year for DSM.”

In the first quarter 2011 organic sales growth for Nutrition was positive against both Q1 2010 (+ 3%) and Q4 2010 (+ 2%). Compared to Q1 2010, volume growth was healthy, especially in Animal Nutrition & Health, but partly offset by lower prices. Against Q4 last year, prices were stable. Furthermore, in comparison to Q1 2010, sales benefited from the Martek acquisition and on balance favorable exchange rates.

EBITDA remained strong and was higher than Q1 last year, due to the Martek acquisition. Excluding Martek the results were slightly lower mainly due to the already mentioned lower prices, the strong Swiss franc and higher costs for raw materials. The negative impact of the Swiss franc in Q1 was some € 15 – 20 million, net of hedging results.

The Martek acquisition has been included in the Nutrition results since 25 February. Martek added € 37 million to the Nutrition sales. This is partly compensated for by the shift of ARA sales to Martek from external sales to internal supplies. The Martek acquisition added € 12 million to EBITDA.