Givaudan to Begin Implementing Price Increases in Q2 to Offset Raw Material Costs
The business delivered strong growth in Latin America as a result of higher volume on existing business and new product launches.
4/8/2011 --- In the first quarter of 2011, Givaudan recorded sales of CHF 1012.3 million, which represents an increase of 3.1% in local currencies and a decline of 5.1% in Swiss francs, against strong comparables.
Givaudan is successfully implementing price increases in collaboration with its customers to offset the impact of higher raw material costs. These price increases will become effective in the course of the second quarter and will show its full impact in the second half of the year.
The Flavour Division reported sales of CHF 544.9 million, a growth of 4.2% in local currencies and a decline of 4.5% in Swiss francs. This growth has been achieved against strong comparables.
In Asia Pacific and Latin America, the existing business was the main contributor to this growth. In North America and in the developing markets of Europe, Africa and the Middle East, new wins complemented this development. Good innovation on the customer's side resulted in new wins in beverages, savoury and confectionary, as well as in Health and Wellness applications.
Sales in Asia Pacific achieved 5.9% growth, driven by both the developing markets, mainly India and Thailand, and the mature markets of North Asia and Australia. While all segments reported healthy growth, savoury and confectionary grew particularly strong. New wins and growth of existing business contributed to the increase.
Sales in Europe, Africa and the Middle East grew 0.5% against a high single digit comparable. The developing markets of the region continued their good performance with solid gains particularly in Africa, Russia, Turkey and the Middle East. The mature markets of Germany and Iberia recorded solid growth.
In North America sales increased 6.9%. Customers in the region returned to innovation. New wins fuelled the double digit growth in Savoury and Snacks while Dairy had a mid single digit increase. Food Service growth was driven by key beverage wins. During the first quarter of 2011, SAP was successfully implemented in Flavours North America.
Latin America delivered a growth of 7.5%, continuing on the strong success of the prior years. Growth was mainly realised by a strong performance in Brazil and Argentina. New wins and growth of existing products in beverages, confectionary and savoury were the segment drivers.
The Fragrance Division recorded sales of CHF 467.4 million, a growth of 1.7% in local currencies and decline of 5.7% in Swiss francs. This growth has been achieved against strong comparables. Total sales for Fragrance compounds (Fine Fragrances and Consumer Products combined) increased 1.2% when measured in local currencies and declined by 6.6% in Swiss francs to CHF 402.0 million from CHF 430.2 million.
