Chr. Hansen reports “strong Q4 performance” despite higher input costs and exchange rates

12 Oct 2023 --- Danish bioscience company Chr. Hansen reports revenue of €352 million (US$374 million) for Q4 2022/23, up 7% from €328 million (US$ million) in Q4 2021/22. The company notes that earnings growth was driven by volume growth, pricing initiatives and stable operating expenses, partly offset by the negative impact of higher input costs and exchange rates.

Earnings before income taxes (EBIT) amounted to €99 million (US$105 million), up 8% from the year before.

“Supported by a strong Q4 performance, Chr. Hansen delivered a solid result for the first twelve months of the extended financial year 2022/23 at the upper end of our guidance with 11% organic revenue growth and an EBIT margin of 26.9%,” says Mauricio Graber, CEO of Chr. Hansen.

“Throughout the year, we have demonstrated the attractiveness of the markets we serve and the resilience of our business model, supported by a robust and agile organization adapting to changing customer requirements in a challenging environment.”

Year-to-date revenue from September 2022 to August 2023 amounted to €1,332 million (US$1,415 million), up 10% from the same period in 2021/22.

Q4 2022/23 results
Organic growth for the current quarter amounted to 16%. The combined growth for Chr. Hansen’s “lighthouses” — strategic business areas — amounted to 41%, mainly driven by the HMO (human milk oligosaccharide) division. The company’s core businesses delivered 14% organic growth.

Group of people sitting around a table, discussing reports and graphs. Chr. Hansen’s year-to-date group organic growth was driven by 24% organic growth in its five lighthouses.The bioscience company reported a year-to-date group organic growth of 11%, to which its five lighthouses (Bioprotection, Plant health, Bacthera, Fermented plant bases and HMOs) contributed 24% organic growth. In comparison, the core business delivered 10% organic growth.

Free cash flow amounted to €202 million (USD$214.5 million) for the year up to now, a 17% increase from the same period last year. Chr. Hansen reports this growth was driven by an improvement in operating profit and lower taxes paid, partly offset by a decrease in working capital.

Based on the results, the company has adjusted its outlook for 2023, expecting an organic revenue growth of 10–12% for the entire year, an EBIT margin of 26–27% and a free cash flow of €190–230 million (US$202–244 million).

Declaring dividends
Both Novozymes and Chr. Hansen have agreed on certain specific provisions regarding distributions to their shareholders until the completion of the merger, as specified in their merger agreement.

The board of directors has declared an interim dividend of DKK7.72 / €1.04 (US$1.10) per share. The total dividend of €137 million (US$145 million) is equivalent to 55% of the adjusted profit for September 2022 to August 2023.

“Together with Novozymes, we continue the regulatory approval process concerning the proposed merger with closing expected in the fourth quarter of 2023 or the first quarter of 2024,” concludes Graber.

By Jolanda van Hal