Symrise reports flat sales and lower profits for first nine months

The company reported that net sales for the first nine months were slightly down on last year at €1.26bn, compared to €1.27bn in the corresponding period last year, a figure that was hit by a continued slow-down in the third and most recent quarter.

In local currencies the sales for the period were up by 2 per cent, reflecting the strength of the Euro against international currencies, particularly at the beginning of this year.

Breaking the figures down, sales in the scent and care division fell 2 per cent to €609.7m, which translated as a fall of 0.2 per cent in local currencies. The company said that this figure reflected the discontinuation of a number of less profitable orders.

Lower consumer demand in luxury fragrances​

Likewise, it also noted that lower consumer demand in areas such as luxury perfumes, had made a noticeable negative impact on the results, which was partly counterbalanced by positive results in the life essentials, aroma molecules and oral care application areas.

“The market dynamics have continued to slow in the third quarter due to weaker economic prospects and continuing tension on the raw material and foreign exchange markets,”​ said Dr. Heinz-Jürgen Bertram, CEO of Symrise.

Although the company noted that it made significant gains in its global business, namely in emerging markets, Bertram also noted that there had been a distinct return to more conservative ordering patterns in certain regions and sectors.

Likewise, it also said that growth in the emerging markets has slowed down in recent quarters, with sales in those regions increasing by approximately 2 per cent, contributing to 46 per cent of total sales during the nine month period.

Big fall in North America sales​

Regionally, the weakest spot was North America, where sales declined by approximately 8 per cent, although the company underlined the fact that this compared to a higher level of sales in the corresponding period in 2010.

Although the company says that it anticipates continued volatility for the rest of the financial year, it also reiterated that it expects to meet its goal to achieve an EBITDA margin of 20 per cent for the full year.

Likewise, it predicts that it will still be able to achieve group sales growth of 2 – 3 per cent in local currencies, as it continues to concentrate on the more profitable areas of its business, while actually declining business in less profitable areas.