Givaudan Records “Sustained Momentum”

08/10/07 In the first nine months of 2007, Givaudan recorded sales of CHF 3,105 million, an increase of 40.6% in local currencies and 41.1% in Swiss francs. This reflects the inclusion of Quest sales as of March 2007 and the good organic growth of the combined business.

On a pro forma basis, as if Quest had already been consolidated since 1 January 2006 and excluding the impact of the flavour portfolio streamlining, sales grew 5.1% in local currencies. The local currencies growth including this effect was 3.7% and 4.2% in Swiss francs. The integration of Quest International is progressing well. Givaudan reconfirms the planned phasing of its estimated savings and integration costs, published at the 2007 Half Year Results. Givaudan reiterates it is on track to generate the expected CHF 200 million integration synergies until 2010.
 
The Flavour Division recorded nine months sales of CHF 1,780.6 million, representing an increase of 1.9% in local currency terms and 2.0% in Swiss Francs. The discontinuation of commodities ingredients amounted to CHF 40.1 million (expected full year effect CHF 51.5 million) impacting primarily North America. Excluding this effect, the division recorded a nine months local sales growth of 4.2% in local currencies. Europe and the developing markets of Asia Pacific and Latin America largely contributed to this good performance.
 
Sales in Asia Pacific achieved a solid performance supported by double digit growth in the developing markets of China, India, Thailand and the Philippines.  The mature markets of Japan and Australia showed positive momentum.  All segments performed well supported by new wins especially in Beverages and Confectionery on top of a good growth in the existing portfolio.
 
European sales delivered high single digit growth against a strong prior year comparable. This was driven by new wins and good growth of the existing business, particularly in the Beverage and Dairy segments. The performance was strong across all markets with double digit growth in the developing markets of Africa, Middle East, Central and Eastern Europe.
 
Excluding streamlining, sales in North America remained flat against last year. New wins from snacks and continued growth in Confectionery offset weakness in the Beverage and Dairy segments. Fewer beverages launches and declining consumer consumption of milk products driven by industry price increases impacted these segments.
 
Latin America sales showed a positive trend delivering a good single digit growth for the year.  Continued strength in the Savory and Dairy segments contributed to this performance.  Argentina, Peru, Chile and Venezuela delivered double digit sales growth.

The Fragrance Division recorded nine months sales of CHF 1,558.8 million, which represents a growth of 6.0% in local currencies and 6.9% in Swiss Francs against high prior year comparables. This reflects the strong momentum of the combined business.

Fine Fragrance sales in local currency are ahead of prior year. European sales remain strong reflecting steady growth of the existing business and supported by numerous recent launches. Latin America growth was supported by a good performance with international clients. North American sales remain slow, impacted by lower sales at a key client which have not recovered since the beginning of the year. The remaining portfolio in this region shows strong growth supported by the introduction of several new wins across all clients.