Givaudan presents US$5.6B sales driven by price rise and fine fragrances

13 Oct 2023 --- For the first nine months of the year, fragrance and flavors manufacturer Givaudan has made sales of CHF5,265 million (US$5,591 million), an increase of 2.9% LFL and a decrease of 3.5% in Swiss francs.

The market environment continues to be “challenging” in some key markets and segments for the company. Givaudan says it continues increasing prices with its customers to compensate for the increased input costs this year.

“We are pleased with our sustained sales growth, with particularly strong performance in Fine Fragrances, high growth markets and Europe,” comments Gilles Andrier, CEO at Givaudan.

“We continue to have a strong focus on innovation to support the unique differentiation that we bring to support the growth of our customers while simultaneously delivering on our performance improvement plan objectives. I am very proud of the ongoing commitment of the entire Givaudan organization in what remains to be challenging times.”

In the same period last year, Givaudan recorded sales of CHF5,458 million (US$5.46 billion), of which Fragrance & Beauty sales were CHF2,489 million (US$2.48 billion). Taste & Wellbeing accounted for CHF2,969 million (US$2.97 billion), an increase of 6.4%. However, its flavor business in North America fell by 2.8%.

Fine fragrances drive growth
The Fragrance & Beauty division recorded sales of CHF2,511 million (US$2,667 million). This is a 6.4% LFL increase compared to a 5.8% growth last year.Givaudan is increasing prices due to increased input costs this year.

“On a business unit basis, Fine Fragrance sales increased by 13.7% LFL against a high prior year comparable growth of 14.8%. Consumer Products sales increased by 5.2% LFL, and sales of Fragrance Ingredients and Active Beauty increased by 1.9% LFL,” outlines the company.

Givaudan credits the growth to the “strong performance” of Fine Fragrances with “high levels of new business” and increasing prices implemented in all its businesses.

Double-digit growth in snacks
On the other hand, Taste & Wellbeing gained sales of CHF2,754 million (US$2,925 million) LFL, with a decrease of 7.3% in Swiss francs.

Givaudan shares that there was a double-digit growth in snacks and “good growth” in sweets. There were lower volumes in health care, savory and dairy segments.

“On a regional basis, sales in Asia Pacific decreased by 2.3% LFL; sales in Europe increased by 2.9% LFL; sales in South Asia, Africa and the Middle East increased by 16.3% LFL; sales in North America decreased by 10.6% LFL and in Latin America, sales increased by 13.1% LFL,” details the company.

For the future, the company aims to achieve organic sales growth of 4 to 5% on a LFL basis, with free cash flow of at least 12%, over a five-year strategy cycle.

Edited by Venya Patel