Q3 wrap: Nutrition stars for DSM and Naturex

By Shane Starling

- Last updated on GMT

Q3 wrap: Nutrition stars for DSM and Naturex
Royal DSM saw Q3 sales slip 7% to €2.3bn across all divisions with polymer intermediates performing worst, but as has been the case in recent quarters, the Dutch firm’s nutrition cluster held firm with 1% organic growth in difficult economic times.

DSM said the €400m+ acquisition of omega-3 leader, Ocean Nutrition Canada, in the summer had added 4% sales growth; favourable currency movements added another 4%.

“The integration of Ocean Nutrition Canada is on track with sales of €30 million and EBITDA of €8 million. Personal care continued to grow especially in sun care and skin care. DSM Food Specialties realized growth in all market segments. Especially enzymes showed strong organic growth.”

“EBITDA for the third quarter was €202 million, up €26 million from the same quarter a year earlier driven by higher margins, favorable exchange rates and the contribution of Ocean Nutrition Canada. At 21.4% the Q3 EBITDA margin was in line with the defined target of 20% - 23%.”

For the nine months to date, EBITDA fell 16% to €866m from €1,032m on sales that hovered around €6.8bn.

“The Eurozone challenges remained significant and the slow-down in China persisted. The US continued to grow at a modest rate,”​ the company said, noting a drought in the US led to higher grain prices that negatively affected its animal nutrition division.

Feike Sijbesma, CEO/Chairman of the DSM Managing Board, noted the company’s investment strategy.

“We continued to make good progress towards our strategic goals with the purchase of Tortuga and Cargill’s cultures and enzymes business. We have now invested €2.3 billion in acquisitions since the end of 2010, of which €1.9 billion in Nutrition. With these acquisitions we are building new platforms and are strengthening our downstream network.”

He said forecasts were for ongoing tough economic conditions and that the company remained focused on cost control measures.

Naturex grows revenue 16.7%; nutrition stars

Another firm that has pursued an aggressive acquisitions policy in recent years, French botanical extracts leader Naturex, bucked the grim economic climate with a 16.7% jump in consolidated revenue to €223.1m for the nine months to the end of September.

Nutrition & Health division revenue hiked 26.1% to €66.5m to be the stand-out division in growth, if not volume.

“The Group's positive momentum for the first nine months of 2012 reflects not only good performances in developed countries despite pressure on consumer spending in Europe but also strong contributions from emerging countries,”​ Naturex said.

Overall Q3 revenue of €75.9 million was up 20.2% from Q3, 2011.

For the nine months, Naturex’s Food & Beverage division had revenue of €142.8 million, up 11.9% (8.4% at constant exchange rates), “with accelerating sales in the US and emerging countries that offset weaker consumer spending in Europe and the slowdown for the distribution of ingredients of the Australian subsidiary.”

Its Personal Care unit earned €3.6m.

It emphasised the importance of emerging markets with Eastern Europe, Asia, Latin America, Africa and the Middle East accounting for 16.9% of company sales compared to 14.1% in 2011. Those regions grew 40.5% in the nine months to September.

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