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Thursday, September 29, 2022
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Firmenich records record results despite a difficult macroeconomic environment

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Firmenich International SA, the world's largest privately held fragrance and taste company, announces its annual results for the 52 weeks ending June 30, 2022.

Financial Highlights

  • Revenue of CHF 4723 million, up +11.1%1 Adjusted EBITDA of CHF 905 million, up +10.9%.
  • Adjusted EBITDA margin 19.2%, up +10 basis points
  • Free Cash Flow of CHF 414 million, down -19.1%, or -5.9% on a comparable basis2 EBITDA to free cash flow conversion ratio of 51.8%.
  • Record revenues and adjusted EBITDA, despite a challenging global environment for raw materials, logistics and energy costs.
  • Outperformed the industry in terms of sales growth and market share gains, supported by double-digit revenue growth in the fragrance and ingredients and Taste & Beyond segments, driven by improved customer demand.
  • Revenue growth in all regions, and strong momentum in our main geographies, particularly in Europe (+18.9%), India (+13.1%), China (+9.4%) and North America (+5.1%).
  • Strong cash generation, despite higher security inventories related to the priority given to customer service supply in a challenging global environment.

"Firmenich's strong performance in fiscal 22 is the result of our ongoing commitment to serving and innovating with our customers, and is a testament to the strength of our fragrance and taste offerings. We are now entering a new chapter in our history, with the announced merger with DSM, and I am pleased to see that our company is entering this new phase from a position of strength," said Patrick Firmenich, Chairman of the Board of Directors.

"Despite a still challenging macroeconomic environment, Firmenich posted another year of good results, with double-digit growth in revenue and adjusted EBITDA. We have demonstrated leadership and excellence in execution. As always, I want to thank our 11,000 employees who made this possible. I look forward to the coming year, which marks the beginning of a new chapter for Firmenich ," said Gilbert Ghostine, CEO of Firmenich.

Farm Strengths

  • Continue to prioritize customer sourcing, preserving TOTIF3's superior service levels, in a particularly challenging global environment for raw materials and supply chain.
  • Firmenich has benefited from its continued investment in growth segments and differentiated offerings, including sugar reduction, natural and renewable ingredients, plant-based foods, clean and responsible fragrances, e-commerce and digital channels.
  • Continued investment in strategic markets, underscored by the move to a majority stake in ArtSci in April 2022 to better serve China's high-growth taste market.
  • Continued strategic investment in innovation:

o Announcement of the creation of a Scientific Advisory Board in May 2022 to oversee our R&D strategy.

o Inauguration of an ultramodem creation and development centre at Dubai Science Park to build capacity in science and innovation,

o Launch of new biodegradable ingredients such as Muguissimo™ and 100% natural ingredients including Firgood lily-of-the-valley™.

  • Raising the ESG Bar: Improved industry-leading Sustainalytics ESG risk score to 7.5, placing it among the top 50 companies evaluated worldwide; Recognition as one of the most ethical companies in the world by Ethisphere in 2022; obtaining for the fourth consecutive time the triple A score of the CDP; and obtaining for the second time in a row EcoVadis' platinum rating in terms of sustainability, with a score of 88/100, the best in the sector, placing it in the top 1% of the companies evaluated.

Performance for fiscal 2022

In fiscal 2022, the global economy experienced a challenging commodity and supply chain environment, compounded by strong geopolitical instability and new waves of Covid-19 in various regions.

Despite this backdrop, Firmenich recorded record revenue growth across the company, as well as double-digit growth in adjusted EBITDA and strong cash generation. Firmenich has been able to navigate this challenging environment with agility, prioritizing service and security of supply for its customers. Its reliability as a business partner, coupled with the competitive advantage provided by its vertical integration of procurement, has allowed it to continue to gain market share.

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