A satisfactory fourth quarter helped Danish ingredients giant Danisco achieve a 17 per cent increase in earnings per share for the 2002/2003. The company reports a particularly strong performance from its texturant products which met their growth target.
Earnings (EBITA) were unchanged for the year at DK 2,316 million (€312m), from DK 2,315 million for the previous year. Lower interest rates and a lower USD rate helped boost the results consolidated profit growing by 8 per cent to DK 1,017 million, up from DK 940 million in 2001/2002.
Key figures for the Ingredients and Sweeteners division of Danisco show that the market share was sustained for ingredients, continuing at around 2-4 per cent in 2003/04.
Texturant products - the largest product group in Ingredients and Sweeteners (emulsifiers, textural ingredients and functional systems) - achieved the growth target with organic growth of 6 per cent compared to lastyear.
Sales in all product groups saw a satisfactory development, reports Danisco this week. Volume growth was satisfactory at 11 per cent compared with last year, with acquisitions accounting for 5 per cent.
'The stable/favourable development in raw material prices combined with optimal capacity utilisation allowed us to sustain operating margin at a satisfactory level,' said the company in a statement on Wednesday.
Organic growth for the speciality products area - which includes flavours, feed and bioingredients - rose by 2 per cent, and together with acquisitions at 11 per cent, the overall total reached 13 per cent. Adjusting for products that the company phased out, organic growth reached 7 per cent. Growth in bio-ingredients, notably enzymes and cultures, was satisfactory, added Danisco.
Turning to flavours, organic growth stood at 7 per cent, with operating margin (EBITA) on a rising trend in the fourth quarter ended 30 April 2003. Danisco confirmed previous news that, in the wake of the Perlarom acquisition - and in order to boost its analytical and technical knowledge - innovation efforts have been focused at Danisco'sDutch flavour centre to provide the foundation for sustaining profitable growth. Normal-level earnings are expected to be achieved in the 2003/04 financial year.
Higher volume growth but lower prices characterised the sweeteners products. Organic growth stood at 1 per cent for the period, reflecting volume growth in a number of product groups of around 11 per cent. Xylitol sales in Japan and South Korea continued a satisfactory trend and sweetener sales to the North American market were characterised by price competition and good volume progress.
As expected, the fourth quarter was influenced by food producers' launch of summer-related products. Total sales reached DK2,154 million with earnings (EBITA) of DK 322 million. SARS had aslightly adverse impact on sales in Asia-Pacific, added the Danish company.